Cook County Tax Bill Causes Confusion

Cook County’s efforts to be transparent and give taxpayers an accounting of where tax dollars go is causing confusion and consternation for some in Arlington Heights.

Cook County Treasurer Maria Pappas’s office began providing additional information on tax bills this year to show property owners the financial state of their taxing governments. The information includes how much villages or cities are in debt, where property owners’ taxes are going and how much local governments spend along with pension obligations, funded and unfunded.

“I think there has been some confusion as the information is combined in ways that makes it a little more difficult to understand in more depth what the numbers mean,” said Tom Kuehne, director of finance in Arlington Heights.

Recently, a man approached the village board concerned about the village’s debt and pension liabilities.

“What is the village board going to do with these numbers?” the man asked. “The village can’t print money like the government.”

One point of confusion is the total debts and liabilities category.  Arlington Heights residents see a figure of $104 million listed on their Cook County tax bill as debt and liabilities.

“If people look at that and think it’s just debt and bond debt, it’s not true,” Kuehne said.

It does not mean the village is $104 million in debit, instead, it is a combination of debt - some of which is due to accounting procedures that don't allow the village to count deferred revenues until the next fiscal year, Kuehne said

Under that category, the village has $56 million in tax supported debt, $6 million in self-supported TIF debt (from its Tax Increment Finance District, a special tax incentive for local businesses in a specified area), $35 million in deferred revenue and $7 million in accounts payable like payroll and claims payable, he said.

The $35 million figure is deferred revenue in property taxes that is received in March and April but must be applied to the next fiscal year, he said.

“So, that’s just an accounting thing,” Kuehne said.

Cook County, while trying to be transparent, used some misleading combinations of data, he said.

Another example: Arlington Heights’s gross operating budget is listed as $138 million in 2011/2012, but the figure breaks down to $100 million in operating costs and $38 million of capital improvements - so close to 40 percent of the gross operating budget is devoted to capital improvements, he said.

Everyone, from the county to village finance directors, is interested in providing more transparency in government “so we don’t have an issue with doing that,” he said. “Is there a better way to divide this information up and make it more explainable? I’m not sure.”

Kuehne has had some questions from Arlington Heights residents since the Cook County tax bills were sent out. He has tried to explain the bill to anyone who asks his office.

Cook County is pretty transparent; residents just need to know where to go for information. The Cook County Treasurer and Assessor have lots of details on their websites about taxing districts and other information, he said.

Arlington Heights has tried to be transparent and posts its budget, reports and other financial information on its website.

This year, it has added budgets going back five years, Kuehne said. There is also a property tax analysis and additional monthly reports.

“If there are ways we can improve, we’d like to look for ways to do that too,” he said.