North Riverside voters could face a property tax referendum as early as March 2012 as village trustees seek a way to make an annual contribution for police pensions.

Together with an tax levy hike for firefighters expected to be imposed in December, residents could be faced with an increase in their annual tax bills of about $300 per household by the fall of 2012 should such a referendum succeed.

Trustees at a budget workshop on June 28 hinted that such a move might be inevitable after failing to make any contributions for police or fire pensions for three straight years. Trustees are leaning toward avoiding the pension contribution again in 2011-12. That decision will be made final later this month.

The village board’s finance committee may begin charting a course for a referendum campaign at a meeting scheduled for Sept. 12, when it will discuss pension issues.

“Have the finance committee meeting specifically on the pension issues and what we need to do to put one on the ballot,” said Trustee Hugh Hermanek, who recommended holding off on pension funding in 2011-12.

The village’s contribution for police pensions alone in 2011-12 is supposed to be $921,790. In addition, the village’s fire pension contribution is supposed to be $549,381. There is no revenue source for those contributions other than general operating funds, and the options are limited – either find a revenue source or cut services.

“We have tapped into all available revenue streams with the exception of one or two which, if they pop up, will be very nominal in a dollar amount,” said Finance Director Sue Scarpiniti.

“We’ve got to fill the budget gap somewhere,” she added. “So you’ve either got to look to pass some of those increases on to the tax base in terms of residential and commercial customers, or you’re going to need to look at cuts, further cuts beyond the operational budgets and changes in programs that are being offered and service levels that are being offered within the village.”

Trustees appeared to agree on a proposal to begin levying taxes annually for fire pensions. That levy can be implemented without going to referendum, said Scarpiniti, but would only begin hitting the books in fiscal year 2012-13. Levying the full amount to cover fire pension contributions would increase the average homeowner’s tax bill by about $100 per year, she said.

Should voters separately approve a referendum to allow the village to begin levying the full amount for police pensions, that would add another $200 per year to the average tax bill, for a total of about $300 more in property taxes per year.

– Bob Uphues