Illinois state tax increase likely to impact Oak Park schools referendum

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By Terry Dean

Staff reporter

The District 97 Board of Education approved its referendum ballot question Tuesday night — a $75 million working cash bond sale — as well as proposed reductions if the measure is rejected by voters in the April 5 election.

The board, however, will have a special meeting on Monday concerning what impact Wednesday's vote by the Illinois state legislature to raise income and corporate tax rates will have on the district. The board might then choose to downsize their referendum depending on what that impact is, members said. If so, they'll likely vote on a revised ballot question next Tuesday, Jan. 18 — that's the deadline for the board to finalize how much it's going to ask from taxpayers.

The board and administration heard from a handful of people during public comments Tuesday night. Anticipating a larger-than-usual crowd for a regular meeting, Tuesday night's session took place at Brooks Middle School, 325 S. Kenilworth. About 50 people, however, showed up and six people took to the mic.

The speakers represented the CAST and BRAVO performing arts programs — two of the programs on the list of reductions totaling nearly $6 million. They urged the board to remove those items from the list and also expressed hope that the community would support a referendum regardless.

After a lengthy discussion following public comments, the board approved the $5.7 million in reductions to such programs as arts, music, foreign languages and after school sports. Members also approved the ballot question. But members also left open the option to change their referendum model, possibly to an operating tax rate increase, next Tuesday. During Tuesday night's meeting, the board received word that the state legislature was poised to raise personal income tax rates from 3 to 5 percent. Corporate tax rates would go from 4.8 percent to 7. That measure passed out of the state's budget committee just before the Dist. 97 board voted.

Prior to Tuesday night's meeting, members left open Jan. 18 to possibly resize and vote on a new ballot question. Next Monday's meeting will be discussion only.

Members Tuesday night, though, generally were not overly optimistic that whatever happens with the state would dramatically change the district's financial circumstance.

Members also insisted that any state money coming to the district would not be new revenue — thus necessitating the need to go for a referendum at all. Any money would be state aid the Oak Park elementary school district was already owed but which the state had been late to pay. Best case scenario, members noted, would instead be a $70 million bond sale referendum, but the board would need to revise its projections, as well as vet those numbers with their longtime financial advisory firm, PMA Financial Network.

Board President Peter Traczyk instructed fellow member Bob Spatz — the board's point person concerning sizing up projections for the referendum — to talk with the district's CFO and PMA concerning what affect the state's tax hike will have on the district. Those discussions are currently taking place.

Chris Jasculca, the district's community relations coordinator, said they expect to have a better understanding by Friday after hashing out their revised projections.

Traczyk said he'd be open to exploring changing their referendum model to a traditional operating tax rate hike if there's a huge positive impact. The bond sale option, he explained, made sense because it wouldn't hit taxpayers until 2012. Also, it would come off the tax rolls once the bonds are retired in 2018 — the district would then go back to voters for an operating referendum.

Under the current working cash bond sale model, property owners would be looking at an increase of $61 for every $1,000 paid in property taxes.

Traczyk, though, acknowledged that using debt was not the best way to run a district.

With an operating rate increase, the district would receive that money earlier, but it would also be a permanent hit to tax payers.

UPDATE:

The District 97 school board will meet on Sunday Jan. 16 instead of next Monday, the district announced this afternoon.

The change was made in order to comply with the Illinois Open Meetings Act concerning holding a public meeting on a holiday. The board will meet at 4 p.m. in the board room located at the district's central office, 970 Madison.

STATEMENT FROM THE DISTRICT: "During this meeting, the board is scheduled to discuss the impact recent developments at the state level may have on the referendum the district will be seeking in April. The board is also tentatively scheduled to meet on Tuesday, Jan. 18 at 7 p.m. to discuss the same issue and, if necessary, take action on any changes to the referendum resolution it adopted on Jan. 11, 2011. Both meetings are open to the public, and will be held in the board room."

Contact:
Email: tdean@wjinc.com

Reader Comments

2 Comments - Add Your Comment

Comment Policy

jassen from oak park  

Posted: January 14th, 2011 1:49 PM

Note that the board WON'T have a special meeting on Monday. That is a federal holiday. For now, it will just be Tuesday night.

Mary Ellen Eads from Oak Park  

Posted: January 12th, 2011 7:00 PM

This will not be a good year for Oak Park's middle class families in a lingering recession. We now pay exceptionally high property taxes, for a mediocre educational system. Nearly all of the savings of the 2011 federal payroll tax holiday will be cancelled by Quinn and the Democrats' two point income tax increase. At the end of 2011, the payroll tax holiday will end, and we will see another big increase in our tax burden. This referendum will further deplete working families' resources.

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