Lake Zurich sends home rule question to voters in November referendum

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Residents will get to decide if Lake Zurich becomes a home rule community in November.

At their Aug. 18 meeting, Lake Zurich Village Board voted 5-1 in favor of putting the referendum question on the November general election ballot.

Residents will be asked: “Shall the Village of Lake Zurich become a home rule unit pursuant to Article VII, Section 6 of the Illinois Constitution?”

Trustee Jeff Halen was the lone dissenter. Halen said the board did not have enough information yet to vote on the proposal.

“As a trustee, I am concerned we are being asked to vote without all the details, especially the financial needs and projections of what home rule could bring,” Halen said.

Village officials always look at projected revenue and expenditures during their annual budget process, he said. This fiscal year, for example, the utility tax is expected to bring in $1.2 million and the telecommunication tax is expected to bring in about $1 million, Halen said.

He said he wanted to see the same kind of projections made for taxes that could potentially be imposed under home rule status.

Village President Tom Poynton said home rule status alone isn’t a solution. It is one part of the village’s multi-faceted effort to achieve long-term financial sustainability, Poynton said.

“The village is trying to improve its finances with long-term solutions, which is why home rule is on the table. I would be more than happy to discuss other suggested long-term solution suggestions, but I haven’t heard any,” Poynton said. “I feel home rule would be one more tool in our long term financial solution toolbox.”

The village only gets 13 cents of every property tax dollar, he said.

Halen said the additional taxing power would not do much to solve the village’s financial problems. The taxes imposed on residents thus far haven’t, he said.

Despite levying a 2.5 percent utility tax ­— which will increase to 5 percent in November — and making additional budgetary cuts, for example, the village still faces an even larger shortfall next year than during this fiscal year, Halen said. The shortfall for the current budget is $1.5 million.

Halen pointed to the village’s history of misjudging how funds from certain taxes might be used.

“The telecommunication tax — this was in place of the vehicle sticker several years ago and supposed to go towards road improvement. It really isn’t being used for that purpose,” he said.

“The non-home rule sales tax was supposed to go towards stormwater management and infrastructure improvements, things that have been overlooked and neglected throughout the years,” Halen added.

He referred to home rule status as a “lose-lose” situation for residents.

Dale Perrin, executive director of the Lake Zurich Chamber of Commerce expressed similar concerns about how, exactly, the village would use this new power, if granted.

“If it’s to raise additional revenues for the village, then we hope that you clearly define how you plan to do that and in what manner, so we can understand how that will affect local businesses and, therefore, the bottom line and pocketbooks of the consumers,” Perrin said.

Lake Zurich resident Chris Stahoviak said the ideas discussed so far were not sufficient.

“We can tax gasoline by an additional 2 percent, raise the price of gasoline in Lake Zurich by 6 cents-a-gallon. … Congratulations, I’ll shop across the border,” Stahoviak said. “The residents of Lake Zurich will pay — not just those who pass through.”

At the same Aug. 18 meeting, the board approved an ordinance that would bind the village to the limits set forth in the Property Tax Extension Limitation Law, should the village become a home rule community.

PTELL limits property tax increases to the rate of inflation or 5 percent, whichever is less.

While future boards will have the power to rescind the PTELL ordinance, Poynton said, residents will have the power to vote those trustees out of office.

Trustees emphasized that their vote did not transform Lake Zurich into a home rule community. The board does not have the legal authority to do this. The vote simply gave the board authority to ask the residents to decide.

Officials noted that the village will embark upon a public education campaign over the next couple of months leading up to the November ballot.

During the campaign, they plan to discuss the kinds of taxes they could impose under home rule status.

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