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Editorials

Our View: Tax hike holds little promise for DeKalb

City officials in DeKalb want to increase property taxes by 37 percent, a tax hike that would cost the owner of a house with an assessed value of $150,000 almost $200 more a year.

In return for increasing their contribution to the city, residents would receive nothing tangible. The extra money would just make it easier for the city to pay for other obligations and possibly remove a negative outlook placed on its credit rating by a bond rating agency. 

That’s not enough to justify hiking the taxes of every property owner in DeKalb.

City officials said their recommended tax hike would generate about $2.7 million in new property tax revenue. The money would pay a portion of DeKalb’s debt for building its new police station and other bonds. In the past, the city has used other funding sources to pay down those bonds. Some extra money would also go to increase funding levels in its police and fire pensions.

The city must meet its obligations to retirees and creditors, but taking $2.7 million more out of the pockets of local property owners would be a mistake.

There has been an exodus of major retailers from DeKalb in the past 12 months: Barnes & Noble, JCPenney, Big Lots, and Jo-Ann Fabrics. With more money siphoned out of the local economy by a big tax increase, what store will be next?

It’s also concerning that this talk of tax increases comes without any mention of budget cuts.

Reducing spending is tough, but businesses everywhere are doing it this time of year. Talking about tax increases before finding ways to reduce spending is a backward approach.

In the past, plans for tax increases have come at least with the promise of something. A 2013 property tax rate increase for DeKalb’s library expansion cost the owner of a $200,000 house who claims the homestead exemption about $48 more a year. That increase also allowed the city to borrow $6.5 million for a 46,000-square-foot library expansion.

Taxpayers’ contribution created a significant public benefit and enable the library to capture $11.6 million in state grant funds.

The point of this tax increase appears to make people pay more for government they’ve already used.

Instead, the city needs to give the people the government they can afford based on what they’re paying now. 

Before there’s talk of increasing taxes, city officials first need to scale back spending. A 37 percent tax increase should come with some discernable public benefit, not simply appease investment analysts and make it easier for staff to budget.

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