D181 Board Delays Final Tax Levy Vote

The District 181 Board of Education Monday night decided to delay voting on a measure maintaining the maximum, "balloon" levy initially approved in December that could increase the district’s portion of residents’ tax bills by as much as 3.6 percent over last year, but will more likely result in an increase around 2.6 percent.

The 2.6 percent rate increase would result in about $1.3 million in new revenue for the district, assistant superintendent for business Dr. Troy Whalen said. The 2011 levy funds will be used for the latter portion of the current 2011-12 school year and the first portion of the 2012-13 school year.

The 2011 tax rate—which can be extended over 2010's rate based on consumer price index (CPI), equalized assessed valuation (EAV) of property in the district, and the amount of new construction in the district—will be approximately $2.36 per $100 of EAV. The 2010 rate was $2.13 per $100 of EAV.

Whalen has said at past meetings that by not levying to the max, the district leaves dollars on the table in future years because a levy, generally speaking, cannot exceed 105 percent of the prior year’s amount. So a non-max levy this year means the 2012, 2013, and 2014 max levies would be smaller than they could have been.

Board member Sarah Lewensohn recommended Monday at  that the vote be delayed to the board’s March 12 business meeting because board member Marty Turek was absent Monday night and such a measure should get the full board’s vote.

Lewensohn also wanted to wait until March in case there were developments with legislation currently being considered in Springfield that would not allow taxing bodies to extend a levy beyond the prior year's if its EAV declined, like District 181's did in 2011 and could again in 2012.

Whalen said the legislation is sponsored by Sen. Terry Link (D-Waukegan). The district has received word, Whalen said, that Link does not plan to call the legislation any time soon.

. Yaeger said then he was in favor of a smaller levy, possibly reduced to offset the additional revenue the district expects from the estimated $25.2 million in new construction. 

Talk among board members before their December vote was that a flat levy, with no increase over 2010, should get consideration. Whalen said Monday that, with an expected seven-percent decline in EAV from 2010 to 2011, a flat levy would result in a rate of about $2.33 per $100 of EAV, approximately 3 cents less than the expected max levy. 

A flat levy compared to a max levy would save a District 181 resident $95 on a $900,000 home.

“On the flip side, a 3-cent reduction in our operating rates would limit the district by $777,000 in revenue,” Whalen said. “It nearly cuts our revenue in half.”

Lewensohn said the district should not pursue the 3-cent reduction.

“It’s such a small number that I think it puts us at a great deal of risk to do anything,” Lewensohn said. 

Heneghan responded by saying that enrollment is expected to decline in future years, so continuously levying to the max would increase the cost of educating each student.

“Yes, the incremental increases are small, but I think the ultimate effect of them is pretty large,” Heneghan said.

Whalen said the board could ease the taxpayer’s burden without losing future revenue by diverting the revenue from that new 3 cents per $100 from the district’s operating fund to its debt service fund. The debt service tax rate, which is not a capped rate and can be raised and lowered by the district as need be, could then be reduced.

The district will have time to finalize the levy after the board’s March vote. The new construction and EAV numbers arrive in the last week of March, Whalen said. After those figures come in, the district has seven days to submit its final levy.