Thursday, July 28, 2005

By Jeff Kolkey
Source: Northwest Herald

HUNTLEY – District 158 officials on Wednesday enlisted state legislators, financial experts and lawyers in an effort to keep their promise to voters and limit the effects of a November tax increase.

Limiting the tax-rate increase to 55 cents would keep taxes in check, but also would mean a loss of state aid “more than the levy increase generated from the referendum,” according to a draft position paper written by board Vice President Glen Stewart.

State Rep. Mike Tryon (R-Crystal Lake) and State Sen. Pamela Althoff (R-McHenry), along with McHenry County Clerk Katherine Schultz and others, attended the Wednesday work session.

The group gathered to brainstorm options to deal with the district’s problems.

“It is a testament to how important this issue is that they cleared their schedules to be here,” Stewart said.

Although the district might need to continue short-term borrowing for several years, the tax increase in its first year already has eliminated what was a projected education fund deficit.

If nothing is done, the tax rate will continue to increase until the maximum approved by voters is reached over five years.

Voters were told a 55-cent increase would cost the owner of a house with an assessed value of $200,000 about $340 more a year with the homestead exemption.

Full implementation would mean a $1.22 rate increase and cost the owner of a house with the same value about $751 more a year, $411 more than voters were told.

Financial projections show the district has a combined operating fund surplus of nearly $6 million as a result of the tax increase passing in November, said Tony Quagliano, a member of the district’s Financial Advisory Committee.

Maintaining the rate in subsequent years will mean the surplus continues to grow, but the district must tailor its tax levy to stop further rate increases.

Also, those projected surpluses could quickly disappear if nothing is done to prevent the expected loss of state aid.

Although Tryon said he is working to consolidate three bills that would make future tax increase referendums easier for both governments and voters to understand, that would not help the district with its current dilemma.

As the amount of available local resources – property taxes – increases, the amount of state aid the district receives will decrease.

The loss will occur even if the district does not accept all the money voters approved in the November referendum. Although the district would tax at a lower rate, a higher amount is still considered to be available to the district using the general state aid formula.

Several possible solutions were unveiled during the work session, each with drawbacks. Some have never been attempted in Illinois.

Among them is a new referendum that would decrease the previously approved tax rate increase or a referendum that would rescind further implementation of the November referendum. It is thought that these options would lower the amount of available local resources and prevent loss of state aid.

“How that would work when we are still in a [rate increase] factoring mode, I have no idea,” Schultz said. “There is no language in the property tax code to rescind what you have done. You are going into uncharted waters.”

Another idea was a new property tax law that would allow school districts to rescind further implementation of tax increases.

Schultz said it could be possible for a judge to order her office to alter the tax extension process for District 158.

Although Quagliano said he doubted the district had grounds to seek a court order, school district lawyer Anthony Ficarelli said it is an option that is being explored.

Quagliano said the work session was productive.

“It got all the right people in the room at the same time and got all the facts on the table as the district understood them,” Quagliano said. “In that sense, it got the ball started rolling forward. I just don’t know where it will go from here.”

Thursday, July 28, 2005

By Jeffrey Gaunt
Source: Daily Herald

Huntley District 158 school board members don’t want your money.

At least, they don’t want any more than they asked for while campaigning for the 55-cent tax-rate increase voters approved in November.

With that in mind, District 158 school board members met with county officials, residents, state legislators and attorneys Wednesday to explore ways to avoid collecting more money than the law allows.

“We’re dealing with problems in the tax cap legislation,”