Smaller cities like Urbana cannot weather a property tax freeze, Mayor Diane Wolf Marlin told a House Property Tax Subcommittee on Friday.
“This might be politically popular approach to take but one that will have serious local consequences,” Marlin said. “We rely on property tax revenue to fund police and firemen pension and our library."
Illinois has the second-highest property taxes in the nation, which many blame for the mass exodus of people and businesses from the state. In response, Republican lawmakers in Illinois have proposed a four-year property tax freeze along with a Democrat-backed income tax increase.
Marlin testified along with several other panelists about what a property tax freeze would mean for various regions, cities and districts across the state.
“We’ve created enough problems without adding another one," she said. "A property tax freeze will not solve the budget crisis. We expect that by 2021 property taxes available for the General Fund will have decreased from $2.3 million to $1.4 million, which is a decrease of almost a million dollars. That is a million dollars that is no longer available for essential city services such as public safety and public infrastructure.”
Marlin’s sentiments were echoed by other experts, including Teresa Kernc, mayor of the Village of Diamond, 55 miles southwest of Chicago. She asserted that a property tax freeze, while popular, would limit a community’s recovery prospects after experiencing a major disaster such as a tornado or flood.
“I can assure you that never once I have heard a mayor mention raising property taxes without a large amount of concern and regret,” Kernc said. “As mayors, we encounter those we serve every single day… raising property taxes is not something that we want to do. In fact, it is something that we try very hard not to do.”
Ted Dabrowksi, vice president of policy for the Illinois Policy Institute, contended that property tax reform would have to be done correctly and the underlying issues that cause them must also be addressed.
“A temporary property tax freeze without the local ability to reduce local costs is a very dangerous proposition,” Dabrowski said. “As long as contracts and costs continue to rise, local governments will continue to borrow, underfund pensions, find other taxes and fees until the temporary freeze is done. After the freeze, things will be worse. For that reason, we need comprehensive property tax reform. We must address all the issues, otherwise we’ll never really get out of this mess.”
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