By: Braidy Powers, County Auditor-Treasurer - December 29, 2023

The county approved a 2024 preliminary levy increase of 9% on September 13. At that meeting the board also set the date for the truth-in-taxation (TNT) meeting as Thursday November 30 at 6:00 p.m. 

In setting the preliminary levy the board considered a host of factors including increased funding from state and federal sources, the effects of inflation, high interest rates, capital needs, continued staffing shortages, housing needs and unknowns. 

On the revenue side:

One of the major unknowns continues to be the long-awaited final appraisal of our federal BWCA lands. In 2019 the every-ten-years USDA Forest Service appraisal of Boundary Waters lands resulted in a 37% reduction in value. Cook County has been receiving about 1.9 million per year based on the 2009 appraisal. At the request of Cook, Lake and St. Louis Counties, the USDA conducted a new appraisal in 2022 to address our concerns over their appraisal methods. The 2022 appraisal gave a slightly better result. Serious issues with the new appraisal remain and the three counties continue to press the USDA to adjust their methods. A final determination by the USDA has not been made but we expect to hear from them in 2024. The county continues to receive about 1.9 million based on the previous 10-year appraisal but has been holding $550,000 a year in reserve if the USDA final decision includes the requirement to return funds if the negative appraisal result is upheld. On the positive side, the Department of Interior increased payment-in-lieu-of taxes by $90,000 in a separate payment-in-lieu-of taxes program.

The state used part of its extraordinary surplus in 2022 to aid local governments and Cook County benefitted in several ways: We will receive additional payments-in-lieu-of taxes on tax forfeited lands of about $182,000. Part of this is due to an appraisal that increased the value of state lands by 43% and part is due to a 50% increase in formula payments on other lands. County Program Aid increased $158,284. And we received a $128,000 increase in aid for our regional corrections cost. These three aids reduce our levy. The county also received new aid for public safety ($179,095), probation ($185,973) and affordable housing ($99,688), and while welcome, they do not affect the levy.

The American Rescue Plan Act provided $2,039 million of aid to the county in 2022 and 2023. The county board earmarked $700,000 of this for workforce housing and chose to use $466,000 toward levy reduction in 2024.

The 2024 preliminary budget also included increased fees for lodging tax administration ($50,000) and vacation rental licenses ($70,000).

On the expense side:

The county included $110,460 in the preliminary budget for capital improvement plan bonding in 2024.This was an estimate based on the 2023/2024 deferred maintenance costs called out in the capital plan. The Housing Redevelopment Authority levy increased $165,000, primarily for housing projects. New county staff costs planned for 2024 amounted to $128,787. In August we learned that health insurance costs would increase 7.3% in 2024, a dollar increase of about $138,000. The largest increase in the 2024 budget was cost of living increases for employees. Wages are typically more than half of non-construction, non-capital costs for the county and cost of living increases have a large effect on the levy. A 3.5% increase was the result of negotiations with the unions, and the county offered the same increase to non-union employees. Given the size of inflation the past two years, wage negotiations of 3% and more have not been uncommon around the state. The cost of the 3.5% cola, including taxes, is about $460,000 for 2024. Inflation affected other costs across many budgets, including software, equipment, and construction.

At the Truth-in-Taxation meeting on November 30, there were several members of the public in attendance and the concerns they expressed centered around larger than average valuation increases or changes in classification pushing their proposed taxes well beyond the county’s 9% levy increase. The county assessor was on hand to schedule meetings with the property owners for more in-depth explanations.

Leading up to the board meeting on December 12, the Public Health and Human Services Department found ways to cut their levy by about $128,000. Also, the Sheriff offered to reduce his payroll budget by almost $151,000. This decision reflected his inability to fill deputy and dispatcher positions in 2023 and the likelihood that would continue in 2024.

One of the small positives in the high interest rates resulting from the federal reserve’s actions to reduce inflation has been the earnings on the county investments in 2023. We discussed this at the last Budget Advisory Committee meeting.  The committee felt strongly that the county board should use the $500,000 of 2023 excess investment earnings to either reduce the levy or reduce the cost of bonding for capital projects – or both.

At the meeting on December 12, the county board had a difficult discussion on commissioner compensation and comparisons to statewide averages, and finally approved a $3,600 wage increase on a split vote. They followed this motion with approval of using $330,000 of excess interest earning to reduce the cost of capital bonding and $170,000 to reduce the 2024 final levy increase to 5.16%.

County Connections is a column on timely topics and service information from your Cook County government. Cook County – Supporting Community Through Quality Public Service.