Firefighters sue city for getting rid of tax fund

The Crystal Lake firefighters' labor union filed a lawsuit against the city after officials zeroed out the tax imposed on out-of-state insurance companies

By FireRescue1 Staff

CRYSTAL LAKE, Ill. — Firefighters are suing after a tax fund they used for things such as day care services and health club memberships was taken away.

Northwest Herald reported that the Crystal Lake Foreign Fire Insurance Tax Board and the city’s firefighters' labor union filed a lawsuit, claiming the city’s decision to zero out the foreign fire insurance tax imposed on out-of-state insurance companies violated state laws.

The lawsuit also claimed the city council further violated state laws when the tax board was dissolved and the decision was made to withhold foreign fire tax fees and return the money to the insurance companies that paid the fees.

The city council said the claims are inaccurate, and that the vote decided the remaining $150,000 in the tax fund would be used until it is depleted. City council also said they never considered a draft ordinance calling for the dissolution of the board. 

“It’s frivolous,” Mayor Aaron Shepley said. “It is not an accurate document. The things that they allege did not occur. We voted to set the foreign fire tax rate at zero. We had every right to set the tax at the rate we did, and their lawsuit doesn’t have a chance of prevailing.”

The dispute started when the board requested city council approval to use the tax fund, which collects more than $60,000 a year, for items that would personally benefit firefighters, such as Fitbits, health club memberships and day care services for children.

Crystal Lake Fire Rescue Chief Paul DeRaedt, who is a trustee on the tax board, said red flags were raised because the funds are meant for the benefit of the entire department instead of individuals.

“I felt those expenditures – such as the Fitbits, the gym memberships and the coffee beans – were not acceptable because it was more of personal use,” Chief DeRaedt said. “It’s almost like we’re spending additional dollars on things we’ve already provided for them.”

About $61,000 will be collected from the tax in the fall before it is indefinitely halted, unless an agreement can be reached.

“The current foreign fire insurance tax board has done an exact about face on their predecessors over a period of at least 20 years,” Mayor Shepley said. “For now, as long as they’ve made the decision and continue on the path that they insist they have a right, it’s better off that taxpayers not have to bear these expenses.” 

Recommended for you

Join the discussion

Get FIRE CHIEF in your inbox

Thanks! You've been successfully signed up for the Fire Chief Newsletter

Copyright © 2020 All rights reserved.