CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
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Receive the estimated 2024 property tax levy for the City of Naperville, including the Naperville Public Library, and direct staff to publish notice for a truth-in-taxation hearing on December 17, 2024
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DEPARTMENT: Finance Department
SUBMITTED BY: Raymond Munch, Finance Director
BOARD/COMMISSION REVIEW:
N/A
BACKGROUND:
Pursuant to 35 ILCS 200/18-60, the City Council is to determine the amounts of money, exclusive of election costs, estimated to be necessary to be raised by taxation upon the taxable property in the City. The proposed estimate of levy can then be considered for final approval at the December 17, 2024 City Council meeting. This satisfies the minimum 20-day requirement between the estimate of the levy and the adoption of the levy.
By law, the City is required to approve and file with the DuPage and Will county clerks a tax levy ordinance by the last Tuesday of December if the municipality chooses to raise revenue through real estate taxes. Several statutorily required steps need to occur prior to the filing of the levy. These steps include:
1. Make the tentative annual budget available for public inspection and publish notice of a public hearing.
2. Hold a public hearing on the tentative annual budget and pass an ordinance approving the annual budget.
3. File the approved budget with county clerks within 30 days of approval, but before the tax levy ordinance is filed.
4. Estimate the amount of taxes to be levied at least 20 days prior to approval.
5. Determine whether a truth-in-taxation hearing is required.
6. Publish notification in the newspaper of the truth-in-taxation hearing not less than seven days and no more than 14 days prior to the date of the truth-in-taxation hearing.
7. Hold the truth-in-taxation hearing and adopt the levy ordinance.
DISCUSSION:
Per Illinois state statute, municipalities are required to publish notice for a truth-in-taxation hearing if the amount of the requested aggregate levy is 105% of the prior year’s extension or more. The aggregate levy is defined as the combination of the annual corporate levy and all other special purpose levies. The aggregate levy does not include debt service levies and levies made for the purpose of paying amounts due under public building commission leases. When comparing the 2023 extension to the 2024 aggregate levy, the levy increases by 5.1%, requiring the City to provide notice and hold a truth-in-taxation hearing.
|
Purpose |
2023 Final Extension |
2024 Estimated Levy |
Change (%) |
|
General Corporate |
8,032,274 |
8,168,000 |
1.7% |
|
IMRF |
1,990,407 |
2,249,042 |
13.0% |
|
Naperville Fire Pension |
10,364,676 |
10,999,453 |
6.1% |
|
Naperville Police Pension |
8,103,040 |
8,946,595 |
10.4% |
|
Naper Settlement |
3,912,917 |
3,897,251 |
-0.4% |
|
County Levy Adjustment |
35,144 |
- |
_- |
|
Naperville Public Library |
16,489,024 |
17,177,493 |
4.2% |
|
Aggregate Levy |
48,927,483 |
51,437,834 |
5.1% |
To provide a more accurate comparison of the year-over-year change in property tax, the chart below compares the 2023 extension to the estimated 2024 property tax levy with debt service levies and abatements. This amount of $58,877,699 is what staff estimates is needed to support the proposed 2025 Annual Budget. This total is the full amount to be levied, after debt service abatements, represents a 2.8% increase from the 2023 extension, and is projected to result in an extended rate of 0.6279 (assuming EAV growth of 6%).
The final 2024 extension and tax rate will be determined once the final equalized assessed valuation (EAV) has been determined by both DuP age and Will counties.
|
Purpose |
2023 Final Extension |
2024 Estimated Levy |
Change (%) |
|
General Corporate |
8,032,274 |
8,168,000 |
1.7% |
|
Debt Service |
8,373,912 |
15,588,469 |
-11.2% |
|
Debt Service Abatements |
- |
(8,148,604) |
|
|
IMRF |
1,990,407 |
2,249,042 |
13.0% |
|
Naperville Fire Pension |
10,364,676 |
10,999,453 |
6.1% |
|
Naperville Police Pension |
8,103,040 |
8,946,595 |
10.4% |
|
Naper Settlement |
3,912,917 |
3,897,251 |
-0.4% |
|
County Levy Adjustment |
35,144 |
- |
_- |
|
Naperville Public Library |
16,489,024 |
17,177,493 |
4.2% |
|
Total Levy |
57,301,395 |
58,877,699 |
2.8% |
The estimated 2024 property tax levy values shown in the preceding tables are derived from a variety of sources including:
General Corporate
The general corporate portion of the property taxes are $8,168,000. This levy is utilized to support City operations. The 2024 levy amount is an increase of $35,726, or 1.7% from the 2023 extension.
Debt Service Levy
The debt service value is based on the City’s actual annual debt service requirements for 2024 of $15,588,469. When including planned abatements for the utilities and other funding sources, this amount totals $7,439,865, which is a decrease of 11.2% from the 2023 extension.
IMRF Pension Levy
The portion allocated to the Illinois Municipal Retirement Fund (IMRF) is based on the actuarially calculated percentage given to the City by IMRF. The rate increases from 6.82% in 2024 to 7.06% in 2025. The 2024 levy amount totals $2,249,042, a 13.0% increase from the prior year, and accounts for the General Fund portion of IMRF contributions.
Public Safety Pension Levy
Per the 2024 actuarial valuation report, the required contributions to the Fire pension increase by $667,648, or 6.1%, and the Police pension increases by $870,450, or 10.4%. The total required public safety pension contributions amount is $19,946,048. The property tax will fully fund public safety pensions in 2024, with the Food and Beverage Tax funding an additional $1,719,500.
Naper Settlement Levy Request
The Naper Settlement portion is based on the request made by the Naperville Heritage Society. The Settlement receives more than 70% of its annual funding through property taxes. The Heritage Society requested a levy of $3,897,251, which is the same as the prior year’s levy.
Naperville Library Levy Request
The Library portion is based on the request made by the Naperville Public Library Board. The Naperville Public Library is more than 95% funded by property taxes. The Library Board requested the City Council approve a levy of $17,177,493, an increase of 4.2% from the prior year’s levy.
FISCAL IMPACT:
This agenda item estimates the 2024 property tax levy for purposes of determining if a truth-in-taxation notice and public hearing are required. A formal request to approve the 2024 property tax levy will be presented on December 17, 2024.