O’Fallon residents will see an increase in property taxes for 2012.
The city council voted 7-1 on Thursday to approve a property tax levy that maintains the general fund rate at the current 35.62 cents per $100 assessed valuation and raises the debt service fund from 12.67 cents per $100 assessed valuation to 19.50 cents.
This sets the 2012 property tax rate at 55.12 cents per $100 assessed valuation, an increase from 48.38 cents in 2011.
Voting for the tax levy were Bill Gardner, Ward 1, Jim Pepper, Ward 2, John Haman Jr., Ward 3, Bob Howell and Jeff Schwentker, Ward 4, and Mike Pheney and Michael Snowden of Ward 5. Ward 2 Councilwoman Rose Mack voted against the bill. Ward 1 Councilman Rick Lucas and Ward 3 Councilman Rick Battelle were absent.
The debt service fund, serviced by this property tax, pays for the city’s existing debt. New debt can only be incurred after a ballot issue approved by voters.
O'Fallon Chief Finance Director Vicki Boschert said the hike means a homeowner with a $100,000 home would see an increase of $12.98 on their property tax bill this year.
At the Thursday, Aug. 23 meeting, Boschert told the city council, that in order to achieve a level that would fully service the city’s debt needs and keep from taking money out of the reserve, the tax rate needs to be adjusted this year.
“This is the tax that last year, we did not increase, although the calculation, in order for us to make sufficient revenue to pay the debt service, would have called for us to increase that tax rate,” Boschert said, ”Instead, we left that tax rate lower and took money out of our fund balance reserve.”
Boschert said the calculation used to determine the rate, was examined to gather an idea of what the fund would need for the next 10 years.
“What we don’t want to do, is we don’t want to have to set a rate, come back set a rate higher the next year and then lower the rate,” Boschert said. “I think it makes it harder for our residents to plan, when they’re trying to plan their budget.”