Some employees of Oak Park Elementary Schools District 97 are fuming after learning of an accounting error that resulted in an insufficient amount of payroll taxes being withheld from their paychecks last year and that could affect their state tax returns this year.
Dr. Alicia Evans, D97's assistant superintendent for finance and operations, sent out an apologetic letter to staff alerting them to the error.
"Please be advised that the Illinois income tax rate increased from 3.75 [percent] to 4.95 [percent]," she wrote. "The new rate was effectively July 1, 2017. However, the tax withholding increase was not changed in the D97 payroll system."
As a result, Evans explained, the lower rate was withheld from employees' paychecks for all of 2017 — meaning those employees may likely owe state income taxes when they file their 2017 returns this year.
Evans said that the 4.95 percent rate was applied as of Feb. 16, resulting in "slightly lower take home pay."
The assistant superintendent said that district administrators learned of the error during the week of Feb. 5, after an employee noticed it while completing his or her tax return and brought it to their attention.
Evans wrote in another letter to staff that administrators are working to figure out if the district's financial software provider, Reading, Penn.-based Alio, notified D97 officials about the rate change, "which is our standard operating procedure, and who from the district received it."
Representatives from Alio could not be reached on Monday evening.
"What has further complicated this issue is the fact that this type of rate change is usually issued in January," Evans added, "not July. As a result, the prospect or possibility of a rate change was not something we were monitoring at the time it occurred."
In her letters to staff, Evans assured employees that they would "not lose money because of this situation," will not be penalized and that the situation "will not impact the process [employees] use for filing your state tax return — i.e., you will not need to provide any additional forms or documentation."
Employees will, however, be penalized if they don't submit their tax returns by the filing deadline.
Evans said that the number of checks that were affected by the error varies depending on how often employees are paid. The error affected 13 checks issued to year-round employees, 10 checks issued to 10-month employees and 9 checks issues to 9-month employees.
Evans apologized "not only for the error that was made, but also the way in which it was communicated to you. While I cannot fix the mistake, I will make sure that the necessary steps are taken to ensure it does not happen again."
Among those correctives, Evans listed included making sure that "all future notifications are directed to multiple staff members within the [business] department," facilitating more training for payroll staff and participating "in Alio user meetings to keep current with payroll best practices, updates and changes."
Despite the apology, however, some employees, who insisted on anonymity, said that the error was just the latest illustration of a working environment that has become a "miserable place for people to work" and has thrown in sharp relief a growing divide between faculty and staff, on one side, and "very highly paid" administrators on the other.
"Hundreds of thousands [of dollars] are spent on people to direct District 97," one faculty member complained, echoing the complaints of several others who submitted their statements by way of text message because they feared their district emails were monitored.
"Stress is at a high, morale at a new low," texted another non-administrative employee. "Communication and clarity is non-existent."
The withholding error is the second time in less than a year that the district has been scrambling to fix a major financial mistake. Last June, the district learned from Oak Park Township Assessor Ali ElSaffar about an unanticipated $2.6 million in additional property tax revenue in the wake of a 1-percent limiting rate increase referendum — one of two referenda that passed last April. The district had only asked taxpayers for $13.3 million.
At the time, district officials said that the extra taxpayer money was due to "an unexpected increase in the equalization factor that happened after the D97 school board approved the 2016 levy and finalized the size of the two April referenda.
ElSaffar explained at the time that the unanticipated revenue may have been avoided if the district caught the discrepancy in the draft tax reports that the Cook County Clerk's office sends to taxing bodies before releasing final reports.
"There were opportunities to learn about this earlier and for whatever reason they didn't," ElSaffar said last year, adding that he didn't think the district acted in bad faith. He also attributed the revenue bump, in part, to the way that taxing bodies often "are acting in the dark" as to what EAV will be when they approve their annual levies.
The continued fallout from this most recent financial glitch could be the burden of someone else come June, when Evans is scheduled to leave her current position at D97 to work as the superintendent of business and operations at Rich Township High Schools in Matteson. Evans announced her resignation late last year. In December, D97 Supt. Carol Kelley said that the search for Evans' replacement had already started.
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