US - Residents in the city of Evanston are to vote tomorrow on a proposal to raise real estate transfer taxes by 20%, as the council looks for ways to plug unfunded liabilities of US$140m for its police and fire pension funds.
She said all the Illinois municipalities were struggling to pay their increased pension funding costs, but Evanston was less well funded than the majority of the communities in the state.
At the start of March 2007, the Police Pension Fund was 44.3% funded and the Fire Pension Fund 41.1% funded. The liability for both funds must be 100% funded by the end of the 40-year amortisation period in 2033.
In its proposed budget for 2008-09, the City of Evanston mooted a property tax rise of 15.5%, but a number of other options were suggested to avoid such a large rise.
Carroll said: "Raising real estate property tax was suggested by one of our aldermen as one vehicle to reduce the property tax levy that we need to make up for the police and fire pensions. ÒIt is one option. They are also considering other things, but they want more study on things such as pension obligation bonds or some other form of funding.
"Once we know the outcome of the referendum, then they will know what other things they need to look at to reduce the property tax levy - that is the issue, that they don't want to raise property taxes."
Residents will be asked to vote on the proposal to increase real estate transfer tax to US$6 for every $1,000 of value, up from $5 for every $1,000, on 5 February.
If approved, fifty cents of each extra dollar will go to the City of Evanston Police Pension Fund and fifty cents to the City of Evanston Firefighters' Pension Fund.
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