Naperville has been Ryan’s home for the past 19 years. He’s lived in a few different houses, at first with just his wife and now with their two teenagers.
A gradual hike in his annual property tax bill is something Ryan has grown used to, he said this week, asking that his last name not be used. But when he opened this year’s bill, Ryan was taken aback.
For the 2023 tax year, Ryan owed $22,374.60. That’s $4,313,28 more than the year prior’s total of $18,061.32 — or a jump of nearly 24%.
Ryan wasn’t sure what drove the surge. Was it the schools? His property value?
“I mean, we love Naperville,” he said. “But the taxes are a bit much.”
Property tax bills were mailed out this month, with a first installment due in early June. The annual collection comes every spring for all DuPage and Will county property owners. The bills arrives with the numbers showing last year’s cost per taxing body and the new amount being assessed but no explanation for the increase (or decrease).
The sum is an amalgamation of what each taxing body has requested based the taxable value of a property. The money obtained funds the services and employee salaries they provide.
For Naperville, several government units are taking more in property tax revenue in 2023 than they did in 2022 — blame rising costs and higher property values in recent years.
Still, how much revenue each body needs and how much residents need to pony up isn’t a simple calculation. Location, tax rates and assessments all play a part in the complicated process. Together, they determine why a taxpayer like Ryan, for instance, is paying thousands more in property taxes than he did a year ago but someone else’s bill hasn’t increased by as much or is even higher than his.
In any one community, there are a slew of taxing districts that, each year, have their own charge to add to a bill. For Naperville residents, those could include: Naperville School District 203, Indian Prairie School District 204, Naperville Park District, the city of Naperville, DuPage County, Will County and others.
Last fall, each of these bodies needed to decide how much property tax revenue they needed to recapture for 2023 to adequately supply their coffers. They are required to set a tax levy and notify the county in which they are located.
Districts, however, can’t just levy whatever they want through whatever rate they please. Levies are tied to inflation.
Under the state’s Property Tax Extension Limitation Law, in effect since 1992, taxing bodies are limited to a 5% increase in their property tax extensions, or the previous year’s Consumer Price Index, whichever is lower. Up until recently, the latter was the standard, as CPI stayed shy of the legislation’s upper limit.
But over the past couple of years, high inflation has allowed taxing bodies to bump levies up to the 5% allowed. And they’ve taken advantage.
Naperville School District 203, Indian Prairie 204 and Naperville Park District all levied close to or at the full 5% cap increase. The hikes, taxing body officials say, were necessary to keep up with rising costs.
“We’re also subject to and affected by inflation,” said Michael Frances, Naperville D203’s chief financial officer. “Definitely with regards to keeping competitive wages, but it also affects our costs of services, materials, contacts. Like everyone else exhibits inflation, so does the school district.”
Naperville D203’s tax extension for the 2023 tax year is about $292.7 million, according to Frances. That’s about $15.8 million more tax revenue recaptured from residents than the year before.
Between the 2019 and 2023 tax years, the district’s extension has expanded about 17.3%.
In the same period, the Naperville Park District’s extension has increased about 14.7%. Between the 2022 and 2023 tax years, the park district upped its extension by $1.25 million, or about 4.86%.
Sue Stanish, finance director for the park district, echoed Naperville D203’s need to stay on par with CPI, especially with particularly high inflation during and since the COVID-19 pandemic, she said.
“It’s inflation,” she said. “It just costs more to do everything we’re doing here. From all of our employee costs to vehicle equipment, all of the grass seeds, the fertilizer, our contractual services.”
Stanish added that property taxes account for one of two main revenue sources for the park district, the other being charges and program fees. That makes tax revenue — and recapturing it as much as possible — a “vital piece” to supporting the district’s operations, Stanish said.
Indian Prairie D204 faces a similar constraint, according to Matt Shipley, the district’s chief school business official. About 76% of the district’s revenue comes from property taxes, he said. The other 24% is supplied by state and federal funding. The latter source, Shipley said, has not kept up with inflation, putting more pressure on the property tax levy to deliver.
“That’s the reality for us,” he said. “We’re very dependent on property taxes as our main source of revenue.”
Indian Prairie’s total 2023 tax year extension for 2023 was $357.4 million, about $16.5 million — or 4.84% — more than the prior year. Over the past five tax years, the district’s extension has grown just shy of 16%.
Shipley said Indian Prairie “would like to be in a position where maybe we don’t need to take the full amount” as allowed by PTELL but again, the district “hasn’t been immune to significant increases … as it relates to CPI.”
Now, how these extensions trickle down to individual taxes is tough to say, Shipley, as well as Stanish and Frances said. That’s because you can’t just look at what taxing bodies are doing, they say, but also how property values are faring, as determined by local township assessors.
A district’s overarching tax rate is decided by weighing the revenue it wants to recapture out of the total value of taxable property within its boundaries. That rate is then applied across taxpayers, whose individual property values inevitably vary depending on where they live and the size and amenities of their house.
Take the city of Naperville’s latest property tax rate, which came out to 0.6463. Applying that rate to a home valued at $300,000 versus one valued at $1 million yields a different output. In turn, if your home went up in value in 2023, even if tax rates went down — which the city of Naperville’s did slightly over 2022 — you could still end up paying more.
Generally, assessed value for DuPage County as a whole increased 5.1% in 2023, according to data from the DuPage County Clerk’s Office. In Will County, total assessed value went up about 7.7%.
With all the factors considered, if your Naperville property tax bill did bear the impact of bigger extensions and higher assessments, Will County Treasurer Tim Brophy implored taxpayers to take a beat and think of their bills as representing “all the things that we do together.”
“We educate our children together,” he said. “We provide parks and recreation. We provide libraries. … What I always tell folks is which one of those items on your bill would you eliminate? Which one of those services would you not want to have?
“You could live on an island and only abide by your own laws and rules,” he said. “You’d have no one else to worry about and none of these things would appear on a tax bill. But you wouldn’t have any of those things either. You make a choice about where you live and how much it costs to have all the (services) that go along with it.”
