The Bloomington City Council voted Monday to keep the annual property tax levy flat, effectively lowering the city’s property tax rate — after an initial proposal to raise the levy was voted down.
Revenue from the levy will be kept at 2023’s $22,320,384 level.
At the council’s meeting, public commenters were the first to weigh in on the issue, with two speaking against raising the levy.
Thomas Joseph, who moved to Bloomington 10 years ago, said rising property taxes was straining his ability to afford housing.
“Every year my property tax has increased so much that it has exceeded my budget. Now that is causing a lot of pressure on how much I can afford,” Joseph said.
Property tax depends not only on the city’s rate, but also on property values in the form of EAV [equalized assessed value]. Joseph blames the proliferation of more high-priced housing in the city for raising EAVs and, indirectly, his tax bill.
“I think the new developers are building bigger homes, and the prices are higher,” he said. “And that causes the existing home prices to also go higher.”
EAVs have been on the noticeable rise, with another 9.84% bump this year.
City staff had recommended increasing in the levy by $4 million. That would have translated to a rate increase of about 7%. An owner of a home valued $200,000 would have paid about $50 more per year — though with EAV increases added on, it jumps to $113.
The city council was quick to acknowledge the unpopularity of raising taxes. One of the chief reasons it was on the table was the city’s commitment to fund police and firefighter pensions that together consume about 43% of the property tax levy. That’s where, had the council voted for the increase, the $4 million additional dollars were headed.
The council voted down the levy increase on a 5-4 vote with members understanding the argument that property taxes were burdensome enough already, but also reiterating the need to pay into pensions as planned.
Some members, like Sheila Montney, said the city should find the money to pay pensions in other revenue sources. Others, like Donna Boelen and Cody Hendricks, wanted to see if the city could increase its efficiency, then revisit increasing the levy later.
“Maybe this is the year, we can weather some of the storm, pay those pensions out of general fund and see where those efficiencies come through for next year, and kind of make that determination of what we do with the levy then,” said Hendricks.
Raising the levy later or not at all would mean finding funding elsewhere for pension payments. Council member Mollie Ward raised the point that drawing from other funds for pensions could drain programs benefiting Bloomington residents.
“Yes, these streams of money come from other places, but ultimately, they come from taxpayers, too,” Ward said. “I think we’re deluding ourselves if we think we cannot put this on taxpayers simply by not dealing with property tax issues.”
Ward argued putting off the levy issue to help homeowners could hurt many people who can’t afford to buy houses because they could see their tax dollars pulled from support systems.
After the defeat of the proposed levy hike, the council voted in favor of a flat levy by a 7-2 margin. The two votes against were cast by Boelen and Tom Crumpler.
The flat levy may add to budget challenges already in Bloomington’s future. Illinois’ grocery tax is phasing out in 2026, and the city’s improved recruiting for firefighters and police also may contribute, since positions previously vacant will be collecting salaries and benefits.
City manager Jeff Jurgens said he understands the council’s decision, but it may be difficult to deal with the repercussions. He said the city is committed to fully funding pensions and general funds will be used. After that, cutting programs may become a necessity, though Jurgens said specific targets hadn’t yet been identified.
“We’re going to have to look and consider everything at this point,” he said.
According to Jurgens, the city will run on a deficit of at least $6 million two years from now.
He hopes cuts can be made with the minimum impact on Bloomington’s residents. Normal has opted to create its own grocery tax to replace revenue lost when the state’s tax ends. Jurgens said neither Bloomington residents nor the council want a tax, especially because it impacts impoverished people the most — but that it couldn’t be ruled out as a possibility.
Bloomington library
In another matter, the council passed a slight increase in the Bloomington Public Library’s tax levy. The new levy gives the library about $300,000 more than before, and bumps the property tax by about $10 annually for the owner of a $200,000 home.
The library’s levy passed 6-3, with no votes from Sheila Montney, Kent Lee, and Nick Becker. Other council members praised the library’s successful reopening after recent renovations and the financial stewardship of director Jeanne Hamilton.
