STERLING – If the Sterling City Council approves a recommended property tax levy in December, it could shave some money off residents’ tax bills.
But it would be a pretty close shave.
Sterling aldermen voted unanimously Monday to approve a staff-recommended estimate of the levy at $4.72 million. That’s an increase of $135,704, or 2.95 percent, over last year. The proposal assumes the city will receive a projected 3.3 percent increase in equalized assessed valuation.
Mayor Skip Lee said that means if the levy is eventually approved, the owner of a home valued at $83,300 – the median value for the city – would see a decrease of $2.14 a year in property taxes.
The proposed levy also would meet the actuaries’ recommended contributions to the fire pension fund of $1,159,533, compared to $1,132,888 last year, or a 2.34 percent increase; and $1,137,726 to the police pension fund, versus $1,058,614 last year, or a 7.5 percent increase.
City Manager Scott Shumard said the police and fire funds have grown to about 49 percent of the overall levy. The state is requiring pensions be 90 percent funded by 2040.
At the request of alderman Jim Wise, staff also worked up an alternate levy estimate, where the fire and police pension funds were funded at the minimum level required by state statues.
Lee said that under that plan, the fire and police pension funding would be lowered by a combined $511,462, or a 10.5 percent decrease in the levy.
Under that proposal, the owner of a house valued at $83,300 would see a decrease of $84.98 a year, or $7.08 per month in property taxes.
Lee said the city’s actuarial firm, Lauterbach and Amen in Warrenville, said that contributing the minimum for 3 years would drive up the city’s required contribution by 52 percent in 2022.
If the city makes the full contribution, it would face only a 5 percent increase.
While all of the aldermen approved the estimate with higher funding for the fire and pensions, Wise said he’s still advocating for a 1-year reduction in the pension contribution.
“I hope to have a long-term plan in place for the 2019 tax levy process. This is to do away with the council coming in here ever again and voting to increase property taxes by 19 percent, and to have a plan in place that gives certainty and a stable rate of increase at least until 2036,” Wise said.
The city instituted a tax levy increase of 18.76 percent in 2015, as well as a utilities tax.
Shumard said he’ll also ask Lauterbach and Amen to work up figures based on the city contributing the minimum for
1 year, with the results possibly presented as soon as the Nov. 20 council meeting.
The council does not have to vote on approving the levy until December.
The council also heard a report from Bill Yocius, CEO of Mitchell, Vaught, and Taylor, Inc., which handles Sterling’s fire and police pension investments. He said that the funds’ investments are performing better, with a 9.8 percent increase from last year.
The City Council next meets at 6:30 p.m. Monday, Nov. 20, at City Hall, 212 Third Ave., in the first-floor Council Chambers.
Go to sterling-il.gov or call City Hall at 815-632-6621 for an agenda or more information.