The Champaign City Council considered an array of rates for the 2007 tax levy in a study session Tuesday night, ultimately voting 6-2 in support of increasing the tax rate almost 3 cents per $100 of equalized assessed valuation.

Champaign Finance Director Richard Schnuer said this will mean about a $45 increase on the average homeowner’s property tax bill.

Last year, the Council voted to drop the tax rate to $1.2942 per $100 of equalized assessed valuation, about 1.78 cents lower than the 2005 rate. However, the actual equalized assessed valuation for Champaign was higher than expected, dropping the tax rate to 1.2659, according to a report to the City Council from Schnuer.

It took two straw polls for the Council to approve the 1.2942 rate this year, almost 3 cents higher than last year’s actual tax rate, after one lower rate and one higher rate were both voted down.

This rate is the result of a compromise among the Council, after city staff proposed going back to the 2005 rate of 1.312.

Schnuer said the 1.2942 rate will result in about $18.75 million in revenue from property taxes for the city. This money will be used to fund police and fire pensions, capital projects and the library.

About $1.2 million in additional revenue will be used to finance “unfunded needs,” Schnuer said, including improvements to arterial streets, addition and relocation of fire stations and the proposed new public works facility.

“A tax increase is not popular, but you do want us to recommend what we think is right,” Schnuer said.

Dist. 5 Council member Ken Pirok originally voted against the rate increase. He said he changed his vote when it became apparent to him that the Council would not favor keeping the rate the same as last year.

“Everything on the (budget) doesn’t need to be as costly as they are estimated,” Pirok said. “And everything on that list does not need to be funded with property taxes.”

At-Large Council member Thomas Bruno said the tax increase is necessary to keep up with obligations the city will face in the future.

“We (lowered the tax rate) for a year,” Bruno said. “Now we’re realizing we have some long term needs.”

The Council will hold a public hearing before they vote on the tax levy during the Nov. 6 regular meeting.