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County could see slight tax increase to support VAC

Published: Tuesday, March 25, 2014 8:54 p.m. CDT

MORRIS – A proposed small increase in each Grundy County taxpayer’s tax bill could mean more funding for the Grundy County Veterans Assistance Commission.

At Monday’s Grundy County Finance Committee meeting members discussed implementing a 0.02 percent tax levy as an alternative way to fund the VAC. The committee was unclear how much the increase would mean per household and Grundy County Assessor Dave Henderson could not be reached Tuesday.

For the current fiscal year, the VAC’s total operating budget is about $191,000. Since the VAC was established, it has always been funded through the county’s general fund.

Based on the county’s current property values, a 0.02 percent levy would equate to about $363,000 in revenue, far more than the VAC would need, County Administrator Heidi Miller said. Funds generated by the levy could only be used for VAC related expenses.

Miller said the levy would secure a new source of funding for the VAC, lightening the cost burden on the county’s general fund.

VAC Superintendent Ken Buck said Tuesday he proposed the VAC levy knowing the county was facing a budget shortfall because of potential losses in sales tax revenues from Morris and Channahon next fiscal year.

The county stands to lose more than $1.8 million in sales tax revenue from several major companies not headquartered in the area that allegedly route sales through offices in Channahon and Morris to take advantage of Grundy County’s low tax rate.

The two municipalities are being sued by the Regional Transit Authority for diverting sales tax revenue from rightful taxing districts.

“I suggested this as a solution. It’s not a great solution. It doesn’t replace all of the millions [of dollars] that is missing,” Buck said. “But it’s a solution to help my program and make sure that our services can continue for a while.”

Buck said several other counties in the state, including Kankakee and Kendall, levy funds specifically for their veteran’s commissions.

Assistant State’s Attorney Perry Rudman assured the finance committee the county would not have to pass a referendum to implement the levy because it is such a small amount.

Concerns were raised by a few committee members regarding the permanence of the levy. Specifically, they worried the levy rate would be fixed and could not be easily changed if the VAC needed less funds then levied.

“Whatever you set [the levy] at, that’s it. It stays there,” committee member John Almer said during the meeting.

Rudman said he would look into whether the county could legally change, and possibly scale back, the levy amount in future fiscal years.

The VAC would only levy the funds it needed to provide the services it already provides and nothing extra, Buck said.

“Right now, based on our expenses, we probably wouldn’t even need the full 0.02 [percent] levy,” Buck said. “We would levy what we needed, but I would also hope that we could add a little bit to build up a cash reserve.”

A cash reserve could work as the VAC’s rainy-day fund and be used when it is faced with unexpected costs, Buck said. With the reserve, the VAC would be more self-sufficient and less dependent on county funds.

Most finance committee members supported the idea of the levy, but will be looking into the subject further before making any decisions.

“I know the county is not to keen on increasing taxes,” Buck said. “But considering the revenue shortfall that’s about to happen, this is one solution.”

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