Flossmoor School District 161 is moving forward with a 2020 levy that marks a 2.68% increase over last year’s extension, but the failure of Illinois’ “fair tax” amendment and a significant reassessment of commercial property raised some new financial questions.
The school board voted unanimously on Monday, Nov. 9, to approve a tentative levy of $24.43 million, a 2.68% increase over the 2019 extension of $23.80 million — the 2.3% Consumer Price Index plus an attempt to capture an estimated $500,000 in new property, according to Associate Superintendent Frances LaBella.
At the top of the conversation, LaBella addressed the concerns of a community member who questioned the use of December 2019 to establish the CPI. LaBella said the law requires boards to use the CPI from 12 months prior to when the new levy is established, which places it in December of the year prior.
“Truly, we don’t have any control over that,” LaBella said. “The Cook County Clerk puts out that’s the CPI they will use. … They statutorily will impose that CPI.”
The district’s levies for 2019 and 2020 are lower than in years prior because the school board agreed to abate $1.93 million in property taxes in exchange for receiving a $1.7 million through a Property Tax Relief Program grant from the Illinois State Board of Education earlier this year. To receive the grant the school board agreed to abate taxes by that amount for two consecutive years.
District 161 was one of 39 school districts receiving grants. The grant, part of the Evidence-Based Funding for Student Success Act, allows eligible districts such as district 161 to cut local property taxes and replace that revenue with state funds.
But LaBella said she is concerned about EBF going forward, following a decision Nov. 3 by voters to say no to the state’s graduated income tax proposal. She told the board that Gov. J.B. Pritzker has said if it failed there would need to be significant state budget cuts.
“What’s going to happen to our state funding?” LaBella asked.
It remains a question mark, but she outlined for the board what 10% or 20% cuts to EBF could do to the district. At 10%, it would reduce funding by $360 per student. Multiplied by 2,300 students, that would equate to an $828,000 impact to the district. At 20%, that impact would jump to $1.65 million.
The proposed increase in the levy would not cover either of those reductions, she said.
“If they even cut that evidence-based funding by 10%, we’re back in a red position,” she said. “We are strongly suggesting a CPI levy.”
Adding to the concerns for this year’s levy is how one major commercial property “saw a massive reduction in the value of their property because they appealed,” according to LaBella. She told the board the reassessment reduced commercial property in town by $311,800, which she said shifts the tax burden to residents when looking at total property in the district.
“Their piece of the pie got smaller while yours got larger,” LaBella said. “Once they did that, their piece of the property tax bill got significantly smaller, but someone has to pick up the slack.”
LaBella did not name the company during the meeting but confirmed in an email to the Chronicle that the commercial property in question is Meijer.
Board Secretary Misha Blackman said the Finance Committee supports the tentative levy. But she echoed concerns about the financial questions ahead.
“What we are walking toward are real concerns,” she said.
She said any cuts to the budget could complicate things for the district, and noted the district is in a bind because the biggest problems are external rather than ones that can be addressed by board actions.
“This board has no control over what Springfield does,” board member Cameron Nelson added.
He argued that the two things the state is “constitutionally required” to fund are pensions and education, but the school board could not take actions now based on what Springfield might do.
“It doesn’t swing me on this immediate levy decision, because those problems haven’t quite crystallized yet,” he said.
But Nelson forecasted the board will have to get creative — whether that means looking into software, supplies, machines or reopening procedures.
“We do need to look at cost-cutting measures,” Nelson said. “I’m not above counting pennies. … I suspect we’re going to have to make real decisions in the spring.”
Superintendent Dana Smith said he thought the district could support the CPI increase and recommended moving forward with it. But he said when examining budget issues going forward, things could get tough.
Most expenses in the district are people, and there are only so many other places that costs can be cut, he explained.
“It’s all going to hurt,” Smith said. “It’s not like any changes we make financially won’t have an impact somewhere.”
Cutting staff is a “non-starter” at this time, Blackman said.
“Our kids need our teachers more than ever,” she said. “If we get cuts, that’s a real problem for our students and teachers.”
Board President Michelle Hoereth said it would likely be more about “maximizing efficiencies,” which is a responsibility of the board.
“Could we be doing things better?” she said.
The board is planning to hold a public hearing and vote on the final levy during a meeting slated for Monday, Nov. 30.