Cronin’s final budget plan avoids property tax increase in DuPage

DuPage County Board Chairman Dan Cronin has unveiled a $586 million budget plan that boosts pay for employees but doesn’t raise property taxes, even though local governments in Illinois can seek a maximum 5% increase as a result of surging inflation.

As he prepares to step down after his third term, Cronin has released his final budget proposal while reflecting on his legacy and urging his successor to “maintain a conservative, cautious approach to spending.”

The Elmhurst Republican took the helm of the county board in belt-tightening mode, barely removed from the throes of the Great Recession. This year’s outlook is considerably brighter: the county stands to reap a $40 million surplus by the end of fiscal 2022. But Cronin is still sounding a note of caution.

“While our revenue picture is certainly better than it’s been in years past, we must acknowledge the skyrocketing costs and supply chain interruptions that impact our ability to deliver services, just as they impact the private sector,” Cronin said.

Because of the state-imposed tax cap, most local governments can’t increase the amount of annual property taxes they receive by more than the rate of inflation or 5%, whichever is less.

But a 7% growth in the inflation rate from December 2020 to December 2021 means local governments can boost their property tax haul to the maximum allowable level this year, according to the Illinois Department of Revenue.

“I’m sure some local governments will do just that,” Cronin said.

However, Cronin is proposing to keep the county’s property tax rate flat “to equalize the burden on us all.”

The balanced budget proposal calls for a $70 million property tax levy that would account for new construction being added to the tax rolls. The owner of a home valued at $250,000 pays about $132 a year in property taxes to the county. DuPage government accounts for less than 2% of the average homeowner’s property tax bill.

But board member Jim Zay is pushing for relief on property taxes to help ease the sting of inflation on homeowners. Zay suggested a $65 million tax levy. He cited federal COVID-19 relief and the county’s cash reserves as reasons for a tax cut.

“I think it’s time to pass on some savings to our residents because they’re hurting at this point,” the Carol Stream Republican said.

Cronin said he’s “open and receptive” to the idea.

“I do think that this would require careful consideration, and I know that we make a supreme effort to minimize our levy. I think our levy is pretty minimal as it is,” Cronin said. “We are very, very dependent on sales tax revenue, which from a sort of tax policy perspective is probably not ideal.”

Sales tax revenue – a primary source of the year-end surplus – grew by $21.4 million, or 19.6%, when compared to budget estimates. The county reported collecting $12.1 million in August alone, the second-highest month ever. Taxes on internet sales, a relatively new revenue stream, have been the main driver for the increase, officials said.

“We don’t believe it’s a one-time blip,” DuPage Chief Financial Officer Jeff Martynowicz said. “We’ve seen trends that suggest that what we budgeted for – $130 million in sales tax in ’23 – is going to remain at that level, and we track it very closely.”

Overall, budget planners originally predicted the county would finish fiscal 2022 with $210 million in general fund revenue. The county likely will end up with more than $240 million. Expenses also should come in $10 million under budget this fiscal year, which ends in December.

Cronin outlined plans to spend the unusually large surplus on big-ticket items to “eliminate millions of dollars in burden on future budgets.” Some of the extra cash would pay for the following:

• $3 million for major renovations at a county-owned nursing home

• $2 million for transportation infrastructure

• $2.5 million to cover liability and insurance costs

• $6 million to replace the county’s existing financial system

• $3.25 million to replace aging vehicles

• $250,000 for the “Neighborhood Revitalization Program,” an effort to remove or repair dilapidated or abandoned buildings

The county’s total head count – 2,255 – is increasing by a net 10 positions after staffing reductions by the county recorder and circuit court clerk. The state’s attorney’s office is adding 12 positions, including four prosecutors, to comply with sweeping criminal justice reforms.

Cronin’s recommended budget provides an estimated $6 million in pay raises to help retain and attract county workers.

“We value our well-trained, highly skilled and professional employees, and we recognize the importance of retaining them in a very competitive market,” Cronin said. “We are also painfully aware of the impact high inflation rates have had on our employee families. The fact is everything costs more. Earlier this year, gas prices spiked. We’re currently seeing prices for groceries and goods higher than we’ve seen in decades.”

Nonunion employees would receive a 4% cost of living increase, instead of the usual 2%, paid out in December. The county also would award a 2% merit increase in February 2023 to those eligible. In addition, full-time, nonunion employees earning $55,000 or less would receive “a one-time inflation adjustment.”

County board members have until the end of November to approve a 2023 budget.

https://www.dailyherald.com/news/20220928/cronins-final-budget-plan-avoids-property-tax-increase-in-dupage