COW QuickStory: Downtown EAV Plummets 15%, What Will City Do?

The City Council Committee of the Whole looks hard at some budget challenges—one of the biggest being the downtown business district, where assessed values have dropped dramatically, according to estimates by the Geneva Township assessor.

Geneva's downtown, already under siege with more vacancies than at any time in a generation, is seeing an unexpected and unprecedented 15 percent drop in its estimated assessed value.

What that means for downtown property owners is the prospect of having to pay a higher share of the costs for city services.

What it means for city officials is a complex problem: What services do you cut or what revenue sources do you increase to make up the estimated shortfall?

The downtown Special Services Area No. 1 was the No. 1 topic in an open-ended discussion Monday night at a special meeting of the the City Council's Committee of the Whole. Community Development Director Ellen Divita presented the council with a PowerPoint presentation that showed the SSA's estimated assessed value for 2012-13 at about $46.2 million.

If Township Assessor Denise Lacure's estimates are correct, the SSA's 2012-13 total assessed value represents a 15 percent drop from 2011-12 and a whopping 25.7 percent drop from 2010-11.

Total EAV of SSA No. 1

2012-13: $46,230,437 (estimated)

2011-12: $54,591,204

2010-11: $62,216,856

How could that happen? City officials are scratching their heads.

"We would like a better explanation," said City Administrator Mary McKittrick. "As we understanding it, it was the tax assessor who decided to lower the values on those properties on her own."

The decrease in assessed value translates to a decrease in revenue and puts the city between a rock and a hard place. Exacerbating the problem is a balloon debt schedule for the 2001 purchase of the former Seigel lumber yard lot that is now used for parking.

The city has to pay a little more than $30,000 for the next four years to retire that debt, but must pay $199,785 in the final payment year of 2016-17.

Other issues include a maintenance and capital projects schedule for city parking lots, as well as the Master Plan implementation that includes capital projects for additional downtown parking.

Some of the potential solutions:

  • Defer parking lot reconstruction and maintenance.
  • Cut services—snow plowing and streetscaping are examples.
  • Implement a leasing fee for public lots filled by daytime employees.
  • Add a local sales tax to SSA No. 1. The tax can be raised in increments of a quarter-cent.
  • Establish another SSA for the business district for beautification.
  • Bond to cover expenses.

The council generally agreed that the city's contribution should be about equal to the revenues gathered from the SSA. In past years, the ratio was as high as 2-to-1, with the city contributing a greater portion of the maintenance and capital improvements to the downtown.

First Ward Alderman Chuck Brown said he did not have an issue with the city paying for downtown services because the community as a whole does benefit from those services.

"Having a viable downtown is what makes Geneva Geneva," he said.

Back To Work Illinois January 31, 2012 at 06:13 PM
Instead of cutting services like snowplows or delaying construction projects, Geneva should look to the state’s Video Gaming Act when looking for solutions to its budgetary problems. The VGA represents the biggest funding source for the $31 billion statewide capital bill introduced by Gov. Quinn in 2009. Through the VGA, the state collects a tax of 30 percent of the net income generated by local video gaming terminals. Subsequently, the state then redistributes one sixth of that percentage into the municipality’s general fund, where its use is unrestricted. By using the VGA, Geneva would not only be contributing to a statewide capital plan that will help fund myriad infrastructure improvement projects and create hundreds of thousands of jobs, but it would also be generating $618,750 annually for its own priorities. To learn more about the VGA and the Illinois capital bill, please visit www.backtoworkillinois.com.
Karen Phillips February 01, 2012 at 07:59 PM
http://articles.chicagotribune.com/2010-05-11/news/ct-met-0512-kane-video-gambling-20100511_1_video-gambling-kane-county-video-machines TheTribune identifies Kane County as the only county in the state of Ilinois to vote for video gaming expansion when 75 others voted to ban the gambling. The Chairman of the Kane County Republican Party even voted for gaming claiming this was about jobs. Kane County has received no jobs (but perhaps more consulting contracts) since the reverse position on this issue. It appears that the consultants are hoping to pick up support from the City. Nothing like jumping on a story about declining revenue to bring out the gaming interests. Is it possible to look elsewhere first?
Bob McQuillan February 01, 2012 at 09:29 PM
The answer to the assessment question is quite simple. The previous assessor did not assess properties under the guidelines of 1/3 of the market value. Denise LaCure is fixing a major problem that she inherited. Anyone who had a conversation with the former assessor knew what the office attitude was. It is now 180 degrees different. Bottom line, businesses and residents have been over assessed for years. Thus, we have been over-taxed for several years. Why do you think the School District has more than 47 million in reserves? Yet we are 325 million dollars in debt. It is from the community being overtaxed and voting for palaces. The City of Geneva has actually done a pretty good job over the last few years. Others have not reduced expenses. They may have reduced budgets but expenses continued to increase. There is a difference between a budget and an actual expense. It doesn't take a genius to realize that things are going to get worse for at least the next 5 years. Increased spending has led to increased property taxes and lower assessed values. The perfect storm. Check out www.genevataxfacts.org The financial reports for every taxing body on your tax bill is listed. Get you favorite beverage and spend awhile on the site, you will be "enlighted." Attend a board meeting and see what is happening right in front of your eyes. This isn't fantasyland, it is reality. www.genevataxfacts.org you'll know why taxes have continued to rise.


More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something