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City Council approved Elgin’s proposed 2026-27 budget and a higher property tax rate on first reading last week, with another round of discussion ahead before both are finalized.
The budget is built around a proposed rate of 68 cents per $100 valuation, up from nearly 62 cents last year. The increase would cost a homeowner with a $100,000 house about $66 more in taxes this year.
Budget documents show the proposed rate would generate about $8.5 million in property taxes, up from roughly $7 million last year. Almost $300,000 of that increase would come from new property added to the tax rolls.
The average homestead tax bill is projected to rise from $1,657 to $2,001, based on a projected 4% increase in taxable value, according to officials.
Elgin City Council approves the proposed 2026-27 budget and tax rate on first reading Sept. 1. The budget includes a nearly six-cent tax hike that would generate an additional $1.5 million for the city. File photo
The proposed rate includes about 57 cents for maintenance and operations, with the remaining cents for the city’s interest and sinking fund, which covers debt payments.
Officials said much of the additional revenue from the higher tax rate would go toward recurring personnel costs, including new employee positions and a compensation study, although council members have not finalized how the money will be divided.
“Those are recurring costs that you can then budget on, and you would expect to be able to pay for (in the future),” Acting City Manager Beau Perry said.
Perry said the city projects a positive general fund balance and that some previously set-aside money remains available, though he cautioned it cannot be treated as a recurring revenue source.
About $400,000 from a prior bond-related fund could also be used for certain parks or police expenses.
“You do have an amount of money that if you did decide to do one-time capital, buying, equipment or funding the reserve that you have that ability to,” he said.
Perry noted the council can still lower the rate before final adoption, but they are under a time restraint.
The Sept. 1 votes do not finalize either the budget or tax rate.
The council is scheduled to hold another public hearing Sept. 15 before voting on the final tax rate.
