The District 200 Board of Education has opted to forgo a standard 2.1% increase in the annual tax levy, effectively providing well over a million dollars in tax relief to local property owners.
Under Illinois property tax cap laws, school districts are permitted to raise each year’s tax levy up to the Consumer Price Index (CPI), which for levy year 2017 is 2.1%. By holding the levy to $66.6 million and forgoing the CPI increase, the District prevents a tax hike of nearly $1.4 million in its portion of local property tax bills.
This is the fifth consecutive time that the D200 Board has opted to provide tax relief since 2013, when the district convened the Finance Advisory Committee (FAC). That committee’s charge was to make recommendations to rightsize the district’s fund balance. At that time the district’s reserves stood at $130 million, or 173% of annual expenses, one of the largest fund balances in the state. The Board was concerned that tax levels were unnecessarily high and were eroding the public trust.
One of the FAC’s recommendations was to bring the fund balance gradually and responsibly below 100% within two to four years, and below 40% within eight to 10 years. To help achieve these goals, the Board has opted to cut its share of the local tax bill by more than $30 million in recent years. Though the current fund balance is at 124%, this includes $20 million that the Board has earmarked for facilities improvements. As part of the district’s strategic plan, recommendations on a long-term facilities plan are due to the Board this summer.
An additional piece of the strategic plan currently underway is convening a new Finance Advisory Committee to review and revise the 2013 recommendations. Those included planning for an operating referendum when five-year projections showed the fund balance dipping below 25%, or approximately $27 million. The compounding effect of forgoing the 2017 CPI increase moves the projected operating referendum timeline up a year, from 2024 to 2023.