Property Tax Proposal 

 
PRESS RELEASE
 
For Immediate Release
November 17, 2009
Contact: Mary Jo Follert
847.923.4710
mfollert@ci.schaumburg.il.us
 

Village of Schaumburg Fiscal Position and Recommendations

 

Estimated Impact on Homeowners

 
Schaumburg, IL - The Village of Schaumburg has a history of providing quality comprehensive municipal services while relying primarily on revenue from visitor's to pay for these services. This strategy has worked extremely well and provided the foundation for the development of the second largest retail area in the State of Illinois and at the same time given residents a superior standard of living at a relatively small cost. As the village has matured the ability to rely solely on income from visitors has diminished. Retail development to the west and internet competition has eroded new growth causing revenues to stagnate. In addition to this trend the worse recession since the great depression has tapped reserves and threatened to reverse progress made over the last 30 years. Major revenue sources of the General fund have declined at a rate of 1.92% a year for the last five years.
 
Since 2003 the village has eliminated 98 full time and 38 part time positions decreasing its full time work force 15.7%. Numerous programs have been suspended or cut. Reserves have diminished. At the same time costs the village has little or no control over continue to rise. Pension costs for police and fire have increased at an average rate of 12.3% over the last five years. Health care costs increased 15.8% just this year alone. Costs for removing and melting snow have increased 63.49% in the last five years. Wages continue to increase due to restrictive collective bargaining laws and the forced arbitration process. Even with the dramatic reduction in employees all these other factors have conspired to increase General fund expenses by 4% per year for the last five years.
 
The village projects that the fiscal year ending April 30, 2010, will end with a deficit of approximately $9 million. The actual deficit is projected to be $12.25 million for 2009-2010, but equity transfers will be used to offset some of the projected deficit. For 2010-2011 the financial picture worsens with a projected deficit of $17.6 million. The village does not have sufficient reserves to cover the anticipated deficit nor meet operating cash flow needs. Either expenses must be cut drastically, new revenues generated, or a combination of both enacted to keep the village operating through 2010-2011.
 
At the Committee of the Whole meeting on Tuesday evening the committee recommended that the Village Board consider doing the following:
 
  • Eliminate 25 frozen positions
  • Eliminate the vehicle sticker fee effective with the 2011-2012 licensing year
  • Takeover curb side garbage collection fee effective January 1, 2011
  • Levy a property tax sufficient to cover any projected shortfall (estimated at $23.7 million)
  • Issue $8.5 million road construction bonds
  • Continue to look for ways to reduce expenses
  • Monitor cash flow and advise
 This restructuring of General fund revenues will result in sustaining village services at their present level given the current economic conditions. The estimated impact of the property tax on a residential house with an equalized assessed value of $250,000, with two vehicles will be basically neutral.
 
"While it is unfortunate that we can not continue to rely on visitors to pay for the majority of village services, restructuring our revenues will allow us to continue to provide the residents of Schaumburg with the highest quality of service for the lowest possible direct cost," said Village Manager, Ken Fritz. "We will continue to work hard to find ways to further reduce costs as well as improve services. We are all interested in keeping the things that make Schaumburg, Schaumburg," Fritz said.
 
101 Schaumburg Court, Schaumburg, IL 60193-1899
P: 847.895.4500, F: 847.895.7806

Dial 311 for non-emergency requests