Mandated Retirement Contributions Could Increase Normal Tax Levy
Town of Normal staff estimate increased retirement contributions could cost the owner of the typical home an extra $37 in property taxes next year.
The precise amount of the property tax levy for the town won't be known until April when assessors lock in new assessment values, but based on estimates of rising property values staff estimate last year's roughly $12.9 million total levy will grow by $641,801.
The increase is 4.95%. That includes an assumption of only modest increases in property values within the town (1.25%) for a total estimated assessed value of $891.2 million.
The town uses its property tax levy mostly to pay for pension costs and the library.
Staff said in documents prepared for Monday's Normal Town Council meeting the largest portion of the potential levy increase comes from state-mandated increases in the contribution to the pension fund for town workers.
The pension fund (IMRF) that covers city and town workers across Illinois has lowered its estimated investment return by a quarter point, to 7.25% and that has a significant impact on required contributions to the pension fund for the Town of Normal.
Town policy also requires increases in the fire and police pension fund contributions to assure reaching full funding by the year 2040.
The proposed $3.9 million portion of the levy to support the public library decreased slightly, by $25,000.
The town's share of total property tax for homeowners is relatively small. The largest recipients of property tax dollars are school districts.
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