O'Fallon Progress

City lowers property tax levy by 4 percent

This chart shows how the city of O’Fallon appropriates property tax dollars.
This chart shows how the city of O’Fallon appropriates property tax dollars.

Homeowners in O’Fallon should see a smaller property tax bill from the city next year.

On Dec. 18, the City Council approved a 4.03 percent reduction in the city’s tax levy, bringing proposed tax collections back to what they were in 2014. The council set the levy at $5,439,470 — a $277,592 reduction from what was requested last year.

“This was accomplished while other communities are having significant increases,” Mayor Herb Roach said. “The staff and council worked very hard to achieve this.”

The property tax levy is the amount of dollars the city intends to collect in property taxes. The city uses property tax to pay for such services as police, fire, ambulance, streets, parks, library and contributions to the general fund and pension-related funds. But property taxes are only a small part of the city’s overall revenue stream. This year’s city budget is about $81 million.

The city’s property tax rate just short of $1 per $100 in assessed value.

So what does that all mean for a homeowner? Someone with a home valued at $100,000 should see a $18.80 reduction in their property taxes for the city and library. For someone with a $150,000 home, the savings would be $28.20.

The decrease was accomplished by reducing the EMS request by $686,484, which was possible due to the department’s current reserves.

With the need for additional police officers in the 2019 fiscal year budget, the General Fund was increased by $244,815 to cover those expenses. There was also a correlated $95,948 increase to police pension due to anticipated future retirements. The amount requested for Social Security was also increased by approximately $61,131 to cover increased salaries.

However, all other funds remain fairly unchanged from the 2016 levy request, including the library.

“We have done our job to reduce residents’ property taxes, but we can only control the city and library’s portion,” Roach said.

In 2017, the city and public library’s tax levy combined represented 12.45 percent of each O’Fallon taxpayer’s property tax bill. For every $100 in property taxes paid, $12.45 went to the city of O’Fallon and the O’Fallon Public Library. The rest of one’s property tax bills funds other entities, such as townships, the county, community college, and public schools. Schools make up the largest portion of one’s property tax bill.

Property values are up

The 2017 estimated assessed valuation for the city is around $665 million. That would be a 1 percent increase from last year, despite more exemptions allowed and successful assessment objections.

The equalized assessed value, or EAV, is equal to  1/3 of the market value of all taxable property within the city.

“City staff is currently working with the county to make sure that they have accounted for all new homes in their EAV calculations,” said Sandy Evans, the city’s finance director.

Evans also said that legislation providing 100 percent exemption for disabled veterans amounted to $38.4 million in O’Fallon, which represents a 23 percent increase from the previous year.

Evans also explained that because of the number of petitions filed with the Board of Review to review property assessments, which could result in the possible loss of assessed values, the projected EAV was reduced by $2.1 million.

However, St. Clair County is expecting to apply a 1 percent multiplier for both O’Fallon and Caseyville townships, which will increase the EAV.