A referendum to lower property taxes could possibly be one result of the new law to revamp state aid to education in Illinois.
A provision in the new law, which was passed last week by the state legislature and quickly signed into law by Governor Bruce Rauner, allows voters in well-funded school districts to petition for a referendum to lower property taxes. It appears that Forest Park School District 91 will be one of the school districts that falls into that well-funded category.
The new law establishes a complicated formula, based on a host of factors, that the state will use to determine a baseline of what is considered an adequate level of funding for each school district in Illinois. In districts that are funded at a level that exceeds 110 percent of what the state deems adequate, a petition signed by 10 percent of the registered voters in the district can place a referendum on the ballot of the next election to lower property taxes to a level that would result in a funding level of no less than 110 percent of what the state considers adequate.
D91 is currently funded at 154 percent of adequacy and is the 34th best financed district in the state according to an unofficial spreadsheet that has been passed around to school officials.
However, D91 Supt. Lou Cavallo cautions that the state has not yet determined adequate funding levels for the 2018 fiscal year.
“ISBE [Illinois State Board of Education] has informed us that it will be several months before adequacy targets are determined,” Cavallo said in an email. “Much is considered, including poverty level, etc. We are unsure at this point what our adequacy targets will actually be. Our district, like all districts in Illinois, will be funded at the Fiscal Year ’17 level this year as the state board reviews data to determine the adequacy targets and develops the rules associated with this new law.”
D91 currently carries no debt and is projected to end the 2018 fiscal year with reserves of nearly $14 million in its Education Fund.
Despite its strong financial condition, Cavallo said, a reduction in local property taxes for D91 would have negative consequences if it were combined with a cut in state aid.
“If we were to have a reduction in general state aid funding and revenue from property taxes, it would be devastating,” Cavallo said. “We would likely need to reduce programming.”
However, the new law provides that no school district, however well-funded, will get less state aid than it received in 2017.
The provision that allows for a referendum to lower property taxes in well-funded districts was put in the new law at the insistence of Republicans and met with little resistance from Democrats.
State Senator Kim Lightford (D-Maywood) was one of eight legislators who hammered out many of the details of the bill in bipartisan negotiations. She said the provision allows voters in well-funded school districts to decide how much money they want to send to schools.
“That’s giving them an opportunity to decide if they want to continue their school districts at that level or if they prefer to lower their property taxes, and the school [district] would have to make an adjustment,” Lightford said. “Most of those school districts have a high reserve.”
Proviso High School District 209 officials do not have to worry about a referendum to lower taxes. According to the spreadsheet, D209 is the 366th best-funded district in the state and is funded at only 71 percent of what the state considers adequate.
The main purpose of the new law is to revamp the state funding formula to direct more state aid to less-well-off districts such as D209.
Lightford has focused on education issues throughout her nearly 19-year-long career in the state senate and has long pushed to direct more state aid to poorer districts. She said she is proud that that objective has finally been achieved with the new law.
“I’m really excited about the substance of what it does,” Lightford said. “It is a proud moment.”
The law also provides for $350 million in additional state aid to school. That additional money will be distributed according to the new funding formula.
Another provision of the new law allows for tax credits for donations to a scholarship fund for students who attend private schools. That was added to the bill at the insistence of Republicans and was strongly supported by Cardinal Blasé Cupich.
Lightford, like most Democrats, had concerns about the tax credit proposal, especially since it was added at the last hour, but was willing to accept it.
“If that was what needed to be done to satisfy the Republican Party, then we needed to consider that in order to get the bill done,” Lightford said.
