The village of Brookfield will ask the Cook County Clerk to extend its 2019 tax levy, for taxes collected in 2020, by 3.8 percent, and this year more of that levy will be going toward funding day-to-day operations outside of public safety.
That’s largely because of a change approved by the village board early this year that increased the assumed rate of return on pension fund investments, from 6.75 to 7 percent. Because the village is assuming a better rate of return, its pension actuary determined that the village didn’t need to levy as much in 2019 for pensions.
The village’s fire pension levy payment, for example, is almost $124,000 less than what it was required to levy in 2018. As a result, the village is levying a little more than $3 million for police and fire pensions in 2019. Last year, the village levied $3.2 million.
“Because of the savings, I was able to push that savings to the general levy,” said Brookfield Finance Director Doug Cooper.
Brookfield hopes to direct about $216,000 more toward general operations with this 2019 tax levy, helping interrupt what has been a general trend of levying less in recent years for general operations as pension obligations have increased.
“It’s certainly better than losing money in that fund,” said Cooper.
Still, pension obligations continue to exert tremendous pressure on village finances and account for an enormous share of the amount Brookfield is allowed to levy for operation purposes.
Of the roughly $8.7 million the village has proposed levying for general operations, pensions account for $3 million of that figure – about 34 percent of the total tax levy. In reality, the percentage of the levy eaten up by pension contributions will be a bit higher.
That’s because Cook County is likely to drive down the village levy request next summer once the total value of new property development is determined. The village has asked for a 3.8-percent increase in its tax levy, but taxes for non-home rule municipalities like Brookfield are capped at the level of the consumer price index or 5 percent, whichever is less.
This year, the consumer price index increase is 1.9 percent, which means the final 2019 tax levy will probably be closer to that 2 percent figure. For example, last year the village proposed a tax levy increase of 13.7 percent, hoping to collect $8.8 million for general operations.
When was all said and done, the village was allowed to levy about $8.4 million.
One part of the levy, which is not subject to state tax cap laws and which increased tremendously last year, won’t see a similar increase this year.
In 2018, Brookfield increased its debt service tax levy by 64 percent in order to fund the payments for bonds issued for road improvements. This year, Brookfield is proposing to increase its debt service levy by 3.2 percent.
The village board will hold a public hearing on the tax levy at its Dec. 9 meeting, after which trustees are expected to approve the levy request.