Village Officials Pursue State Law Change to Soften Blow of Assessment Error

In response to a that would require the village to levy an extra $2 million in property taxes next year, village officials are pursuing a change to state law that would prevent taxpayers from feeling the effect.

After an “optimistic discussion” with staff from state Sen. Alberta Darling’s office, Village Manager Chris Swartz said he hopes state lawmakers will pass legislation to allow the village to front the $2 million with cash on hand or borrowed proceeds, rather than collecting it from taxpayers.

The problem with this plan under current state law is that if the village reduces its tax levy to compensate for the error, it will be stuck with the lower levy amount because of state-mandated levy limits. 

The village hired Ehlers and Associates to prepare its case for legislators. Swartz presented the case Monday to the Village Board.

Ehlers and Associates proposed special legislation to create an exception to the levy limit for municipalities in similar situations, allowing the village to add back to its 2012 levy the amount by which it reduced its 2011 levy.

“It’s a real minor change, only for cases of this type of error,” Swartz said. “It will keep the taxpayer impact neutral.”

Swartz said Darling asked to meet personally with village staff in the next two weeks to learn more about the problem and potential solutions.

“We’re depending on our senator to help us along,” Swartz said.

If legislation doesn’t pass by Nov. 15, Swartz said the village will consider other options, with tax increases last on the list.

“If it doesn’t look like the state law will change, we will have a special meeting to discuss the other options,” Swartz said. “The absolute last thing we want to do is what the state [Department of Revenue] recommended and raise the taxes by the amount of the mistake.”

Village Assessor Mark Brown of Associated Appraisal Consultants made the error when he recorded three extra zeros on the value of the village’s Tax Incremental Finance District No. 1, which includes much of Shorewood’s business district.

This mistake caused the state Department of Revenue to publish an inflated total equalized value of property in Shorewood — a number the village must use to calculate its tax levy.

In a letter to Swartz dated Sept. 15, Associated Appraisal Consultants Chief Executive Officer Bernard Laird apologized for the reporting error and said his office was using a new electronic filing system with which staff was not yet fully familiar.

Upon catching the error Aug. 15, village officials first asked the Department of Revenue to fix the number, but officials there said it violates state statute to edit the numbers after they are published.

Village officials are also considering pursuing state legislation that would require the Department of Revenue to recertify the correct value of the Shorewood TIF District.  

Also at the Village Board meeting Monday, trustees passed an ordinance finalizing the into one North Shore Health Department — a move Swartz said would save the village money in the first year.