TAXATION SERIES: Budget Situation Part 3
The current financial issues stem from several interacting factors:
- Inflation and labor costs: wage increases – especially those mandated by union contracts, healthcare costs, and inflation have dramatically raised the cost of doing business for the County.
- Deferred maintenance: Long-standing capital needs have been postponed. High priority projects such as the Judicial Center HVAC system and roof replacements, courthouse expansion, and upgrades to courtroom technology & AV systems have been postponed, resulting in higher long-term expenses.
- ARPA funds expiring: The expiration of federal COVID-era funds received since 2020 ($38.5 million deposited in the General Fund) has exposed the structural budget deficit that they temporarily masked. Now that these funds are gone, the County’s higher structural costs cannot be funded.
- Transit funding at risk: Kane County has nearly $20 million annually from RTA (Regional Transportation Authority) sales tax revenue to fund County services. Illinois House Bill 3438 /Senate transit-reform package in Springfield this year threatens to redirect these funds to regional transit agencies instead of County government, further jeopardizing the county’s fiscal base.
A Decade of Flat Tax Revenue
Kane County’s fiscal stress didn’t develop overnight. For 12 years, the county board continued to reduce its property tax levy, keeping the burden on residents stable. While politically popular, this approach failed to account for rising costs in labor, maintenance, and essential services.
On November 12, 2024 the County Board adopted the property tax levies for the General Fund, Special Revenue Fund, and Special Service and Special Billing Areas Funds and as part of adopting these property tax levies, the County Board voted to raise the property taxes to the consumer price index (CPI), with the difference between the amount included in the 2025 Budget and the levy of $2,044,971 being allocated to the General Fund – General Account. This additional $2,044,971 is treated as an amendment to the 2025 Budget. The increase to the CPI on all property, not just new construction, was the first time property taxes were raised in 12 years
The county’s General Fund budget for FY 2025 is approximately $144 million. This figure includes the last of the one-time federal relief dollars made available through the American Rescue Plan Act (ARPA). With those funds nearly depleted and expenses continuing to grow, county officials are facing tough choices in balancing next year’s budget.
April Sales Tax Proposal Rejected
In April 2025, the County Board placed a referendum on the ballot asking voters to approve a 0.75% sales tax increase. The additional sales tax would have been dedicated exclusively to funding essential public safety services. The measure would have generated an estimated $51 million per year—enough to close the shortfall and begin addressing long-deferred capital needs. Voters overwhelmingly rejected the proposal, with nearly 75% voting against it.
Read the Full 2025 Taxation Series
- 2025 Budget Situation Part 1
- 2025 Budget Situation Part 2
- 2025 Budget Situation Part 3
- 2025 Budget Situation Part 4
- 2025 Budget Situation Part 5
