In order to create what some trustees called a safety net for the community, the River Forest village board Monday discussed a self-imposed tax cap ordinance that would take effect if voters decide in November that they’d like the village to become home rule.
Trustees approved the home rule referendum at a special meeting earlier this month. If it passes Nov. 6, the village would be allowed all the authority granted to a larger population – more than 25,000 — municipality unless that authority is specifically prohibited by the state constitution.
Those powers would include the ability to raise property taxes more than five percent in a single year. Currently, as a non-home rule community, the village can only raise property taxes to five percent or the one-year increase in the consumer price index, whichever is less.
Trustees suggested they could ease concern about a potential tax increase by creating an ordinance that would hold them to the cap.
“This is about creating trust with the community,” said Village President John Rigas. Trustee Carmela Corsini said she was conflicted about the tax cap ordinance and hoped it would not impose restrictions on future boards. Rigas noted it could be voted out.
Trustee Susan Conti added she had gotten a call from a resident who was also concerned a tax cap would be like the board tying its own hands. The draft ordinance, however, provided exceptions that were broad enough so the board could be flexible, Conti said.
Those exceptions include damage to infrastructure from a natural disaster, an unfunded mandate causing an increase in village expenditures with no offsetting revenue, a reduction in shared revenue from the state and either capital infrastructure expenditures or street improvements. Exceptions to the cap would require approval by five of the seven trustees, or a supermajority.
After input from Finance Director Joan Rock, the board also decided the village should be able to build a levy cap. According to an example in a village memo, if the CPI increase is 2 percent and the village wants to keep taxes flat, they could reserve that 2 percent for future use. CPI increases that non-home rule units decide not to use are currently lost and not recoverable in future years, the memo said.
Some trustees thought that would appear confusing to residents, but Rock said if it’s not done the village will over-levy at 5 percent each year.
Village staff will present a revised tax cap ordinance at a Sept. 10 board meeting. In the coming days, staff will post educational materials about home rule to its website. The material includes a list of actions the village could consider as a home rule community, like implementation of a gasoline tax, liquor tax and head tax on large employers for added revenue. The board will also hold meetings with the public in the months ahead.