The owner of a $100,000 home in Morton will pay $1,090 less this year in property taxes than the owner of the same home in Kewanee, a survey of 18 cities and villages in west-central Illinois found.
The tax bill on a $100,000 home varies this year from $1,930 to upwards of $3,000 across west-central Illinois, with an average of $2,459. (Figures include the Homestead Exemption for homeowners.)
On the lowest end are two communities near Peoria. Morton’s tax burden is $1,940, the lowest of all 18 communities. The next lowest is Washington at $1,945, with a population of 15,400.
Morton Township Assessor Vivian Hagaman said it certainly helps to have industrial properties such as Caterpillar Logistics Inc., Nestle and CORE Construction residing in the village.
“You have companies that are big enough, you’re going to reduce taxes,” Hagaman said.
When there’s so much capital put into a facility, a community will get “more bang for its buck in terms of potential tax revenue,” added Tim Collins, assistant director of the Illinois Institute of Rural Affairs at Western Illinois University.
“That’s one of the reasons industrial development continues to be a big thing, and why you want commercial development,” he said.
That, plus Morton High School is highly ranked and continues to draw people in and drive up the community’s equalized assessed value — basically, the final assessment values used for tax purposes — or EAV.
In terms of EAV, higher is typically better as it’s an indicator of a community’s ability to tax and its wealth. Morton’s most recent is roughly $498 million.
“If the EAV goes up, taxes can oftentimes stay the same or sometimes go down,” said Knox County Chief Assessor Chris Gray. “If the EAV declines, then you might see some of the taxing bodies start maxing out their tax rates.”
In Kewanee, the EAV is part of the problem, said Kewanee City Manager Kip Spears. The EAV for 2013 was $81.4 million
“The EAV has been declining,” Spears said, “so that increased the tax rate.”
At the highest end, residents in Kewanee, with a population of 12,800; Galva, 2,500; and Pontiac, 11,800; will bear the heaviest tax burdens — $3,028; $2,747; $2,740, respectively.
It should be noted there are two separate school districts in Kewanee, each with its own taxing ability. The $3,028 applies to someone in Kewanee School District 229, not Wethersfield District 230.
While the city’s levy is not maxed out, Spears added the higher rates are also undoubtably linked to increased pension expenses.
Apart from a community’s EAV and larger-scale business, Gray said other determinants include parcel count and property values.
While Morton has more high-valued homes built every year — 11 homes upwards of $1 million were recently built — Spears said Kewanee’s property values seem “affordable.”
Affordable is rarely seen as a negative, but looking at the big picture, “affordable” indicates lower property values, which is reflective of the EAV.
The other player here is parcel count.
“The more property you have, the lower the tax rate because you’ll have more people paying into it,” Gray said.
As far as some such determinants, both Gray and Knox County Clerk Scott Erickson said Kewanee’s situation seems similar to that of Galesburg’s a few years ago.
Galesburg is slightly above the average with a burden of $2,560 for an owner of a $100,000 home. Neighboring communities in terms of tax burden include Aledo, whose $100,000-home owners pay $2,569, and Macomb, whose homeowners pay $2,509.
“When Maytag closed (in the early 2004) and everyone left, property values took a dive because jobs weren’t here anymore,” Erickson explained, “so you started seeing ‘For Sale’ signs everywhere and you could buy a $100,000 home now for $75,000 because the market was flooded, so the EAV and values went down.”
“Kewanee, I think, is going through now what (Galesburg) was going through earlier,” Gray suggested, adding that Galesburg appears to be making a sure, yet very slow, rebound.
“I see small increases in EAV each year (for Galesburg),” Gray said, “and that’s going to affect property taxes.”