Property taxes will be going up in Jacksonville next year. At their last meeting, the council voted 7-3 to increase the property tax levy by 3.5 percent. Pensions were the main driver of this increase. The city will need at least a 2.4 percent increase to make its mandatory pension contributions. The remaining 1.1 percent will go towards other city projects, including capital improvement projects. At the November 26th meeting, the council agreed on an extra 0.5 percent increase for capital projects, like improvements the golf course.
Not every alderman agreed that the taxes should go up by 3.5 percent. Alderman Steve Warmowski pointed out that the city’s share of property tax burden has been steadily growing for some time. He went on to make two unsuccessful motions for lower increases to cover just the pension costs. Warmowski was joined by Alderman Aaron Scott on both votes, and Mike Wankel on the second.
Despite having approved the extra increase for capital projects at the previous meeting, supporters of the 3.5 increase did not mention these projects in their debate with Warmowski. Instead, they talked about the longterm risks of underfunded pensions, and the impact of inflation on current revenue. There was no discussion of cutting expenses or any other budget alternatives other than raising the property tax levy.
Will taxes go up?
Supporters of the increase stated repeatedly that they were not raising property taxes. That is technically accurate due to how property taxes work.
Many organizations have the right to levy property taxes, including the school district, city, county, and the airport. These groups set a tax levy, which is a certain number of dollars. Once this value is set, the county collects it from all of the assessed properties in the taxing area. Property owners pay taxes based on their proportional share of the taxable property.
If there was a large amount of growth, an increase in the property tax levy would not lead to higher property taxes. The more properties that are being taxed, the lower each individual tax bill can be. Jacksonville did have some growth in the last year. That will reduce the increase a small amount.
The numerous taxing bodies also mean that the real increase from any one of the higher levies is lower than its stated value. Jacksonville’s municipal government only accounts for around a quarter of the total property tax bill residents receive. So the 3.5 percent increase is only an increase on one quarter of the total bill. But the other taxing bodies also had higher levies, so this benefit washes out in the end for taxpayers.
You can watch the full meeting in the player above, and the workshop in the player below. You can also watch the previous meeting’s discussion here.
City Council hears final arguments, recommendations in Ward 2 recount
The Ward 2 aldermanic race might set a new record for closest election that wasn’t a tie. The first full count showed Gail Simpson leading Shawn Gregory by a single vote. Gregory challenged the result and asked for a recount. Then the race got closer. After the recount, the recommendation of the hearing officer was to declare Simpson the winner by not one vote, but 0.361 votes.
During the recount, all of the ballots were inspected again. That further inspection revealed that some of the ballots had problems. A ballot that is not filled out correctly can be disqualified. One had two colors of ink, one was damaged and had to be reconstructed, and another had two candidates marked. These ballots were resolved on an individual basis.
But there were two sets of ballots that needed further discussion. The first were ballots where the election judge marked them in the wrong place. There is a line where the judge should put their initials so the tabulators know it is a valid ballot. Three ballots, all from the same judge, had marks near, but not on, the provided line. Two of them were for Gregory. They were not counted in the hearing officer’s recommendation.
Another group of ballots came from the Mary Bryant Home. The Mary Bryant Home is a community for the blind and visually impaired. Due to their conditions, many of these voters required assistance in filling out their ballots. To protect the integrity of the vote, especially with vulnerable populations, there are affidavits that must be filled out by the voter and the assistant to make the votes valid. For thirteen ballots, this did not happen.
However, the affidavits do not match specific ballots. To ensure voter privacy, the ballot cannot be directly tied to a specific voter. When the thirteen ballots were thrown out, each candidate had a proportional reduction in their count based on how well they did in each precinct. In the end, Simpson lost 4.278 votes, but Gregory lost just 2.639 votes. That closed the margin, but did not eliminate Simpson’s lead.
The real debate hinges on how comparable council members think these two types of errors are. John Mehlick, the hearing officer for the recount, considered both errors equally disqualifying. Although he stressed that he did not want to throw out any votes, he pointed out instructions were not followed on both. During his remarks to the council, Mehlick stressed that the council should demand “excellence” from its election judges and administrators.
Not everyone agreed with that logic. Questions from several aldermen suggested that they found the initials to be a far less serious breach of protocol than those on the affidavits. Others argued that disqualifying votes due to errors from election officials was not something they wanted to do, and argued both sets of ballots should be included.
The council’s decision
There are three likely outcomes the council could decide on. If both sets of ballots are eliminated, then Simpson wins. If both sets of ballots are kept, Simpson would still win. And if the affidavits are thrown out, but the initialed ballots are kept, then Gregory wins.
The choice is unenviable. Most of the time, standards are set without knowing how it will impact an election. Today, the council knows it is not just setting a standard to follow, it is also picking winners and losers in a democratic election. The Simpson team asked Alderwoman Turner to recuse herself due to her party’s endorsement of Gregory during the campaign. Turner agreed to this request, saying that if her stepping back would help the post-decision healing process in the community, then she would do so.
The rest of the council did not come to an agreement Tuesday night. Aldermen Redpath, Fulgenzi, Proctor, DiCenso, and Hanauer moved to accept the hearing officer’s recommendation, and declare Simpson the winner. Aldermen McMenamin, Conley, and Donelan, as well as Mayor Langfelder voted against, which prevented the motion from passing. Any motion will take 6 affirmative votes to pass.
The council will reconvene Thursday night to continue their discussion of the issue and come to an acceptable agreement. You can watch their full discussion in the player above, and read all of the documents from the recount here.
Golf revenue continues to fall in Jacksonville
2018 was another bad year for the Jacksonville’s Links golf courses. Like most municipal golf courses, the Links loses money every year. It was clear as early as August that 2018 was going to be a particularly bad year for the courses. The recently released 2018 audit shows just how dire the situation is becoming for the courses.
Total operating losses totaled $198,000. This is nearly triple the losses suffered in 2012. Expenses were up eight percent since ’12. The real driver is that revenue is down 24 percent, from $377,000 in ’12 to just $288,000 last year. This is why the cash infusion from the city came much earlier in the year; the Links was struggling to cover payroll expenses due to low revenue. And unlike in years past when the bailout is needed in the winter months, last year the Links needed help during the fall.
Fixing the root problems at the course will not be easy. Golf participation is declining nationally, and Jacksonville has not been spared from these trends. But the first step is admitting there is a problem. A golf advisory committee was created in February 2018 and they did provide some good recommendations for improvements. But their last meeting was more than a year ago. In full council meetings, council members are reluctant to even acknowledge that revenue is down substantially from years past.
Six-figure losses are the new normal for the Links. It is up to the council to decide if they want to continue to write these losses off, or come up with a more sustainable plan for the courses.
You can read the full audit here.
Local Airbnbs to City Council: let us pay taxes
Who wants to pay more in taxes? Normally, business owners point to Illinois’ high tax burden as a problem, but some property owners in Jacksonville actually want to be allowed to pay more. One of these owners is E. Scott DeWolf, who runs an Airbnb location in Jacksonville. But when DeWolf went to the city to voluntarily pay the hotel motel occupancy tax, he was told he wouldn’t be allowed to do so.
Airbnb is a short-term rental service where property owners can rent out rooms or buildings that they own. DeWolf was joined by Professor Kevin Klein and Bryan Leonard to discuss the positive impact Airbnb has had on the local tourism environment. They shared how the experience they can create in their properties fills a niche that regular hotels don’t, and that this draws visitors from across the state and even some from over seas.
However, despite being an internationally recognized brand, Airbnb still operates in a legal grey area. Listings aren’t considered rental properties, because visitors have short stays like at a regular hotel or bed and breakfast. But they aren’t recognized as hotels either because they are otherwise residential properties. As a result, since the start of Airbnb, taxation has been an issue. While Airbnb has taken some voluntary steps to collect the occupancy tax, this collection has varied from jurisdiction to jurisdiction. To further complicate matters, not every area wants Airbnb to operate there. Adding new rooms may impact the viability of existing hotels, and adding new traffic to residential areas can disrupt neighborhoods. In Jacksonville’s case, Airbnb is not recognized as a hotel, which is why they cannot pay the local occupancy taxes.
It may seem strange that Airbnb operators would want this to change. Why ask the council to raise their taxes? There is a very pragmatic reason: if Airbnb locations do not pay the occupancy tax, they cannot advertise with the local tourism boards. This keeps them out of some of the main local referral networks. They cannot even leave brochures with the tourism board.
But their request is also driven by a genuine commitment to the community. These owners have heavily invested in building up their properties and enhancing local tourism. And adding more rooms is necessary for Jacksonville’s busiest tourism days. When sporting events take place, or the college host graduation, visitors often have to room as far away as Springfield or Lincoln. Building up a healthy community is good business for everyone.
In the mean time, DeWolf said that they were still willing to contribute to the community even if they cannot pay taxes directly. He personally offered to donate 5% of his sales, equivalent to the tax he can’t pay, to the Jacksonville Heritage Culture Museum.
You can watch their full presentation in the player above, and the rest of the city council meeting below.