The latest installment in Evanston’s perennial budget season comes as no surprise to Mimi Peterson.

“We do not have a contingency plan except for raising taxes,” said Peterson, who ran unsuccessfully for Fourth Ward alderman in 2001 and is co-chairwoman of the Fair Share Action Committee. “At some point the bubble is going to burst, and there’s going to be a real hard time to be had in Evanston.”

After four years of property-tax increases, the city faces a dilemma in proposing a hike this year. Although the method might be needed to fund the city’s high level of services, aldermen and staff must also consider residents’ fears of being forced out and losing the city’s historical diversity.

“The average-income teachers, firemen and policemen cannot afford to live in Evanston,” said resident Bea Coley, who expects she will leave the city by the end of the year because of rising taxes. “It seems like a long-term plan to eradicate the middle class from Evanston.”

City Manager Roger Crum’s proposed 2004-05 budget calls for a 6.85 percent increase in the city’s portion of the property tax. This equates to a 1.2 percent increase in an individual’s tax bill — about an increase of $102 on an average tax bill of $8,000.

But despite efforts the city has made to moderate increases, taxation remains a thorny issue.

“It shouldn’t be happening,” said Ald. Edmund Moran (6th). “But unless you’re going to be very analytical, it’s very hard to avoid tax increases.”

Though Crum has proposed a 6.85 percent overall increase, only 4 percent is under council control. The remainder comes from state-mandated increases in police and fire pension funds, which were higher than usual.

Property taxes make up about 20 percent of the revenue in Evanston’s $75-million general fund, which finances most of the city’s operating expenses. Other taxes — such as sales tax and the real-estate transfer tax — make up another 44 percent of the fund, with the rest coming from fines, fees and state and federal aid.

This year land owners also face a reassessment of property values, which happens every three years. Deputy township assessor Diane Benjamin said when property values rise, a tax hike compounds the effect on residents.

“I wonder if maybe the aldermen don’t realize what’s happening,” she said.

Figures from the Cook County Assessor’s office show that almost 67 percent of Evanston’s tax base is residential, meaning the burden falls primarily on homeowners, not businesses.

Moran said the timing of the reassessment is unfortunate, but the city has no practical alternatives. “It’s there, it’s part of the governmental system,” he said, noting that the problems lie more in the structural inequalities of property taxes.

“The property tax tends to be very regressive,” Moran said. “It has a disproportionate impact on the people that are least equipped to handle big increases.”

In nearby Oak Park and Glenview, Ill., village managers have not planned for a property tax increase. In Wilmette and Northbrook, Ill., tax increases were less than Evanston’s.

Glenview Director of Finance Dan Wiersma said his village avoided a tax hike because of growth in sales tax revenues, but Glenview differs greatly from Evanston.

“Evanston’s a real unique creature. It has a lot of responsibility in areas that other communities don’t,” Wiersma said.

Moran refers to this extra responsibility as the “Evanston surcharge.”

“We try to be all things to all people, and that costs money,” Moran said. “If you have in mind that having a diverse citizenry is valuable but there’s a cost to it, then you’re going to see that cost in your tax bill.”

But Evanston resident Fred Meyer said the benefit from these resources falls unevenly throughout the city. “The more a person makes use of services from a part of the City of Evanston, the more they’re getting in return on their taxes,” he said. “But if you’re an older couple without kids in school, you’re paying a lot for the welfare of others.”

And for those on a fixed budget, Meyer said, the breaking point could be soon.

“If property taxes go up,” he said, “that person might find their budget is not working and say, ‘Well, I have to sell this place.'”

About this series

Evanston faces a perennial budget deficit, and the choices aldermen and staff must make to resolve it reflect the complex set of values in a diverse city. This series examines four main methods the city can use to bring balance, both to its ledgers and to the community.

Today: Property taxes, page 10

Tuesday: Operating expenses

Wednesday: Programs and services

Thursday: Fines and fees