Five options for establishing Sycamore’s annual city property tax levy were presented to council on Monday.

The options were no increase in city levy, a 2.5 percent increase, a 3 percent increase, a 3.5 percent increase, and a 4 percent increase.

“The levy, divided by our best guess of the community’s Equalized Assessed Valuation (EAV), is going to give us our estimated tax rate,” said City Manager Bill Nicklas.

“This year the community EAV is up by an amount just a little bit under what it was up last year,” Nicklas said. “In terms of percentage increase, a lot of that has to do with a big bump in commercial investment in our community.”

Nicklas said other taxing bodies are capped by a 2.5 percent limit this year.

“The 2.5 percent increase in the levy actually results in a significant city property tax rate decrease, which should amount to a slight decrease,” Nicklas said.

Nicklas gave his support toward the 2.5 percent increase.

“I just want to emphasize that this year, there is a much higher than normal multiplier in anticipation of a continuing drop in market prices for homes, both existing homes and new homes,” Nicklas said.

The city’s trend toward lower tax rates would continue with the 2.5 percent increase, reducing the city tax rate by an estimated 15.4 percent. Nicklas expects a rate of .566, which he said is “just a slice below” DeKalb. He called this an “extraordinary accomplishment.”

“It’s sort of in our goal to be head-to-head with our community to the south in terms of local tax rate,” he said. “Why? Because it helps us to attract new business.”

First Ward Alderman Alan Bauer expressed his approval toward a 2.5 percent increase in city levy; 2nd Ward Alderman Chuck Stowe and 4th Ward Alderman

Darren Knuth also expressed approval.

“When I first considered these options I was leaning more toward the 4 percent,” Bauer said. “But knowing about the multiplier really takes it back considerably. I’m okay with 2.5 percent.”

Property taxes for the Sycamore library are also annually levied. Nicklas said the board recommends a 7 percent levy increase, due to the higher than expected EAV estimate coming out of the county office.

“Equal to that increase, we expect there will be a significant decrease in the library tax rate, which will be on your tax bill next spring,” Nicklas said. “We are looking at the possibility of an almost 12 percent drop in the library tax rate.”

The combined city and library corporate rate should be about 14.5 to 15 percent lower than it was in 2006, Nicklas said.