District 99 School Board Approves $70.3 Million Tax Levy

Community High School District 99 has set its proposed 2012-13 tax levy at $70.3 million, not including the bond and interest fund—a 4.9 percent hike over last year’s levy.

The District 99 school board voted 6-1 during their Nov. 18 board meeting to approve the levy. Board Member Keith Matune cast the lone dissenting vote.

Because this year's increase did not exceed the 2011 extension by more than 5 percent, the district was not required to hold a public hearing or publish levy information, according District 99 Controller Mark Staehlin.

Despite the 4.9-percent increase requested by District 99, the amount of additional property tax revenue a district can receive from existing property is capped at 3 percent, the value set by the Consumer Price Index. Every year, most districts levy higher than the cap in order to capture revenue from new construction.

Preliminary estimates for District 99's property assessments indicate that the 2012 equalized assessed value could drop as much as 8 percent compared to 2011, Staehlin said.

Regardless of the change, the assessed values no longer have a bearing on the district's revenue growth due to the tax cap, he added.

From 2000 to 2007, the district saw assessed values grow at a rate of 8 percent a year. However, the tax extensions were limited to the cost of living factor, which was about 2.7 percent for those same seven years, Staehlin said.

During that time, the district's tax rate dropped from $1.67 to $1.30. Staehlin said the housing market is now "making a correction," meaning the rate is increasing to reflect what it should have been for that period of time.

Staehlin predicts the rate will increase by about 17 cents for this year's levy in order to provide for a 3-percent increase in the district's extension on existing properties. The net increase on District 99's portion of the property tax bill will result in a $44.32 per year increase on a $300,000 market value home, he said.

In explaining his vote, Matune said he is opposed to raising taxes. "The system is broken," he said, referring to the issues with the state and CPI. 

The district's new construction values are expected to be similar to those of last year, when they were the lowest of the past 15 years. Using preliminary estimates from the township assessors, the district expects new values to be about 0.4 percent.

Officials added a new construction factor of .8 percent to the levy request to protect the district.

According to Staehlin, about 80 percent of District 99's revenue comes from property tax.

"It's a double-edged thing, in that it's tough on taxpayers but also provides a fantastic stability to our school system that many schools in Illinois dont enjoy," Staehlin said. "We are able to maintain stability because of our tax levy."

The district's property tax revenue has become increasingly important in recent years as state funding has become less reliable, Staehlin said. Rather than lowering the foundation level for funding, the state will pro-rate between 80 and 84 percent.

Regular education transportation will be pro-rated at 50 percent, Staehlin said.

Additionally, the district is also preparing for the possibility of a shift in pension costs—a scenario that has been debated all year as the Illinois General Assembly looks for ways to address its $83 billion unfunded pension liability, $44 billion of which is from the Teachers’ Retirement System (TRS).

State legislators are proposing that the portion that would typically be paid by the state become the responsibility of local school districts and in turn, that of local taxpayers.

The move would save the state a reported $1.3 billion per year—but mean millions of dollars in costs for already cash-strapped districts, according to reports.

Staehlin said the district would take a $400,000 hit if the shift was implemented next year.

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