Death and taxes are said to be the only two things in life that cannot be avoided. Each spring, as property tax bills are mailed throughout Tazewell County, I am frequently asked about taxes and where our sources of revenue come from. You may be interested in the wide variety of revenue streams that counties have available to them, and how we use those to manage our local government.
First, a brief overview of our budget to give you some perspective. Tazewell County has an overall budget of approximately $56 million. Of that $56 million, $22 million is the general fund that covers most of the core functions of the county and the day-to-day business. We are a “tax-capped” county, which means we can raise our levy (how much we can collect in property taxes) at only five percent or the rate of inflation, whichever is less. We can also add the value of any new growth into the levy. Incidentally, there are 135,000 residents who are served by Tazewell County.
If I asked the average citizen on the street, “What percentage of a county budget is paid for by property taxes?” I would guess the answers would generally be well over 50 percent. In Tazewell County, only seven percent of a home or business owner’s tax bill goes to run the county, which translates to about 19 percent of our general fund revenue. When times are difficult, it is beneficial to the citizens and the county not to be so heavily dependent on one source of revenue.
Unlike school districts, which are highly dependent on property taxes, we are fortunate to have very diversified sources of funding. Our highest revenue stream comes from the local sales tax. This accounts for nearly 28 percent of our operating funds, and is one reason it is so important for communities to have a variety of businesses and a strong commitment to economic development. There is also a one-percent public safety sales tax that helps us pay off and operate our jail. It is critical for a healthy county that the State of Illinois not delay payments to units of governments, putting their financial situation in jeopardy.
Fees are another major source of revenue for counties. There are fees for recording documents, fees for those individuals on probation, a host fee for every truckload of garbage that goes into our landfill…and the list continues on. The number of entities that receive a portion of each traffic ticket is amazing. Although some would consider a “fee” just another tax in disguise, we are generally required to demonstrate that the fee offsets a cost imposed upon us. The cost of a liquor license, copy fees, building permits and cable franchise fees are all designed to pay for themselves.
Jail and building rentals also help in financing our operations. Local jails that are at capacity, as well as the federal prison in Pekin, often lease the open beds in our jail. This generates approximately four percent of Tazewell County’s operating income.
Having multiple, varied sources of revenue helps Tazewell County navigate through different circumstances. Our goal is to use the taxpayers’ money entrusted to us with responsibility and care. iBi