CHAMPAIGN — Looking at a persistently tight budget, the city council on Tuesday is expected to finalize a key revenue source: The tax levy itself would remain at an amount equal to last year's, but property owners would pay at a higher rate after values are estimated to have dropped 2 percent.
Council members will meet at 7 p.m. Tuesday in the Champaign City Building, 102 N. Neil St.
City officials would collect the same dollar amount in property taxes in 2012, but the rate at which homeowners would pay is expected to rise just more than 1 percent.
And while the property tax revenue would remain flat for budgeters, it is the first time in four years that council members have adopted a rate higher than $1.2942 per $100 of assessed valuation. The rate is expected to rise to approximately $1.32 per $100 after council members' preliminary 7-2 approval last week.
In other business, council members are scheduled to have their first public discussion on municipal electric aggregation, a means by which a community buys energy in bulk. The strategy would be expected to save electric customers money on their monthly bills.
The initiative has been a collaborative effort among Champaign, Urbana, Savoy and the county. The Urbana City Council got its first look at the plan last week.
The potential savings amount has been hard to pin down: In Urbana, a consultant estimated an 8 percent annual savings, or $80 over the course of a year for the average Urbana customer.
In a report to the Champaign City Council, officials suggest that residents could save anywhere between 8 and 25 percent on their portion of the bill that deals with the cost of the electricity itself.
That portion usually accounts for 60 to 70 percent of the total bill, according to the report.
Officials place rough estimates of the costs savings in the first year to the communities at $1.4 million in Urbana and $4 million in Champaign.
Municipal electric aggregation works to allow residents to purchase their electricity under one account rather than many individual accounts. Although Ameren Illinois is responsible for the delivery of electricity to homes, customers have the ability to shop for different prices on the electricity itself.
The vast majority of individuals in Illinois do not shop, and they pay a default price set by the Illinois Power Agency, which essentially acts as a broker for those customers.
Under the municipal electric aggregation program, the city assumes the responsibility of broker and has the ability to solicit bids — and, theoretically, better prices — from energy suppliers.
Officials expect the price differences would diminish over time, and the savings on electric bills could be significantly decreased after 2012.
On Tuesday, the council is expected to make a decision on whether to put a question on the March 20, 2012, ballot. The referendum is required if the city is to move forward.