Calumet City isn't tapping residents' property taxes to pay off $800,000 worth of three bonds this year.
Calumet City officials voted to abate -- or reduce -- $800,000 from this year's tax levy during a meeting last month.
The amount could have meant an increase in the property tax levy because bonds are guaranteed by property tax levies, Calumet City Treasurer Mike Zimmerman said.
One bond taken out in 2002 was used to purchase fire equipment, but is being paid for from the Ambulance and Paramedic Fund from fees for ambulance service, Zimmerman said. The city owed $163,177.
The city owed $452,800 for a 2004 bond used for paying off a backlog of bills, Zimmerman said. Since 2004, the city has set aside $50,000 in sales tax revenue to pay off this bond, he said.
A 1999 bond was used for road improvements, traffic signals and repairs to the water tower in the River Oaks Mall area, Zimmerman said. About $165,446 was owed for this bond. To pay for it, the city placed a levy on a special service area around the mall, he said.
A special service area is a carved-out district that benefits from a certain project and is responsible for paying for it with a special levy, Zimmerman said. In this case, River Oaks West, River Oaks East and nearby commercial areas were part of the special service area and paid a special tax levy on their commercial property taxes, he said.
Laurence Msall, president of the Civic Federation, said he hadn't analyzed Calumet City's budget and wasn't familiar with the details, but on the surface the actions seemed positive.
"Certainly municipalities should be looking for all opportunities to reduce their debt and overdependence on property taxes especially in this economically difficult time," he said. "Taxpayers shouldn't be looked at as the first choice for balancing municipal or other government budgets. Instead governments need to focus on reducing their operating costs and operating as efficiently and effectively as possible.
"The best managed communities are also reducing their operating expenses through technology investments, better management and more modern business practices."
