Shorewood projects 1 percent tax increase
Village officials say healthcare costs driving levy
Shorewood — Residents can expect an increase of just under 1 percent to the village tax levy for the coming year, according to a preliminary 2014 budget presented Monday by village staff.
According to the draft budget, available on the village website, the village tax rate is projected to increase 5 cents to $7.17 per $1,000 of assessed property value. A Shorewood taxpayer with a $300,000 home would then pay $2,153 in village taxes, about $16 more than last year.
While the village general operating levy is projected to increase by about 1.6 percent, largely due to a dramatic increase in healthcare costs, the village will spend less on capital expenses in the coming year, resulting in the projected 0.98 percent increase in overall tax levy.
State-mandated revenue limits imposed during 2011-13 biennial budget prohibit increases in local levies for the most part, but allowed municipalities to increase their taxes based on new property value added through construction or improvements. The law also allows, among other things, local governments like Shorewood to roll over expiring debt payments into operating taxes.
According to the village's financial adviser, the total amount the village can roll over equates to approximately 5.6 percent of the village tax levy. By using the first 1.6 percent in the coming year, village officials have about 4 percent left, which they expect to use in 1 percent increments annually beginning in 2015.
"Recommendation from staff is that we take this in small hits," Village Manager Chris Swartz said. "We would want to take five percent up front. It allows us flexibility over the next five years."
"For all intents and purposes, until the state law changes, that's all we've got except for (construction) growth," Trustee Thad Nation said.
Though many aspects of the budget are firmly in place, including a roughly 2 percent salary increase for village staff, details of village healthcare costs remain uncertain.
While the village has maintained relatively low healthcare claims in recent years — about 60 to 70 percent of premium costs in the last few years, Swartz said — a spike in claims this year had the village insurer wanting to raise premiums by nearly 80 percent in initial negotiations.
Swartz likened the increase to the penalties drivers pay after accidents.
"You could have a great driving record, but have one accident and they increase your rate," Swartz said. "It's the same thing here."
The insurer is currently in the area of a 30 percent increase, Swartz said, though he expects the final number to come in around 15 percent, which is the amount included in the draft budget and will likely require some haggling over plan specifics like deductibles. He expects to have quotes in from a variety of insurers within the next 30 days, and will bring the matter back to the finance committee for further consideration.
According the village website, several more meetings are scheduled for further, detailed review of the 2014 budget, with the last in late October.
BY THE NUMBERS
Shorewood's estimated village levy, an increase of 0.98 percent from last year
estimated village budget
projected tax rate per $1,000 of assessed property value
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