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Property tax freeze roundup

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The [Senate Executive Committee] also approved a bill that would freeze school property taxes in years that the state fully funds the new school aid formula and categorical spending. The new funding formula requires the state to increase education spending by $350 million a year for a decade to fully implement it. The state also hasn’t fully funded categorical programs for about a decade, said bill sponsor Sen. Andy Manar, D-Bunker Hill.

Manar said the bill will not take effect until the fiscal year that starts July 1, 2021. He said the total cost when the bill takes effect will be about $650 million — $350 million for the formula and $300 million to fund categoricals. Taxes needed to pay debt service and pensions would be exempt from the freeze.

“This is not immediate, but I think this is a realistic way to severely limit the ability of school districts to raise funds locally,” he said.

* Tribune…

In closed-door negotiations, some Democratic lawmakers have criticized Pritzker’s plan for not doing more to address soaring property taxes. The proposal from Sen. Andy Manar, a Bunker Hill Democrat, would freeze local school districts’ property tax rates if the state lives up to its education funding obligations.

“The concept here is to put a credible proposal on the table to do what I think we all want to do, which is turn off the spigot of property taxes and make the state budget the predominant source of how we fund public schools,” Manar said.

* Illinois News Network…

State Sen. Jim Oberweis, R-Sugar Grove, said that’s a gimmick that won’t attract Republicans to the plan.

“I think you’ll see Republicans standing up to oppose that. We don’t ever like to vote against a property tax freeze but this isn’t a property tax freeze, it’s just political nonsense,” Oberweis said.

While school districts are the main driver for property taxes at the local level, other taxing bodies could continue to raise tax levies on property owners.

“This is typical Springfield politics and it’s become so distasteful I just wish the voters of Illinois would rise up an scream and fire the people that are doing this,” Oberweis said.

State Sen. Andy Manar, D-Bunker Hills, said his bill to freeze the property tax levy included exceptions for pension costs and debt.

“So if a school district wants to build a new building, they would have to have a referendum,” Manar said.

posted by Rich Miller
Wednesday, May 1, 19 @ 9:45 am

Comments

JB said in campaigning that tax reform would lower property taxes.

Comment by CPA Wednesday, May 1, 19 @ 9:49 am
I typically never agree with Oberweis, but he is absolutely correct on this one. The progressive income tax is to fund the existing budget deficits. There is no way the state will be able to afford this additional school funding, which means there will be no freeze on property taxes. Pure gimmick.

Comment by Smalls Wednesday, May 1, 19 @ 9:56 am
==his bill to freeze the property tax levy included exceptions for pension costs==

Kind of a big exception.

Comment by City Zen Wednesday, May 1, 19 @ 9:57 am
===Kind of a big exception. ===

Nope. The state picks up most of the tab for teacher pension costs except spiking costs and the employee portion, which some districts pay due to union negotiations.

Comment by Rich Miller Wednesday, May 1, 19 @ 9:59 am
===this additional school funding===

It’s already baked in. It’s not new.

Comment by Rich Miller Wednesday, May 1, 19 @ 10:00 am
The GOP really wants Oberweis out in front explaining why a school property tax freeze is a bad idea?

That explains a lot.

Comment by wordslinger Wednesday, May 1, 19 @ 10:14 am
So let’s get our facts right. The state wants to take over the the primary school funding (which is their responsibility) and this will hold down school costs? Sure, because IEA and IFT will not have any sway over the politicians in the state? Wow, what world are people living in?

Comment by NeverPoliticallyCorrect Wednesday, May 1, 19 @ 10:16 am
== State Sen. Andy Manar, D-Bunker Hills, said his bill to freeze the property tax levy included exceptions for pension costs and debt. ==

Interesting little bit about pension costs. Right now most school districts pay very little towards the employer portion of the pensions, just what exceeds the thresholds. I will acknowledge a lot of districts, as part of their teacher contracts, do pick up part or all of the employee pension contribution.

Given Andy’s depth of knowledge about school funding, I have to think he knows exactly what that exception means. And it leaves me suspecting a future cost shift of the school district employer pension contribution from the State to the local district.

Comment by RNUG Wednesday, May 1, 19 @ 10:36 am
In this case Oberweis is making many good points that should not be dismissed just because he is ‘Oberweis.’

Comment by Nonbeleiver Wednesday, May 1, 19 @ 10:42 am
=but I think this is a realistic way to severely limit the ability of school districts to raise funds locally,=

Severely limiting the ability of schools to raise funding locally is a good thing???

Given the dependability of the state I would say that this will have serious consequences down the road.

=Right now most school districts pay very little towards the employer portion of the pensions, just what exceeds the thresholds. I will acknowledge a lot of districts, as part of their teacher contracts, do pick up part or all of the employee pension contribution.=

School pay 100% of IMRF and that is a pension, on top of that they pay Social Security and actually have a specific levy for them. Obviously that is not even close to the employer pension cost for teachers but it can be substantial.

I don’t know what the actual data is on districts that pay the teachers portion of TRS, If I had to guess it would be 60-70%. Back in 2011 schools approached MJM with a request to add a TRS levy if they were going to pass cost shift and he turned his back and walked away.

This seems like they are setting the stage for cost shift.

Comment by JS Mill Wednesday, May 1, 19 @ 11:44 am
== While school districts are the main driver for property taxes at the local level, other taxing bodies could continue to raise tax levies on property owners.==

In other words, make the perfect the enemy of the good. School districts account for the lion’s share of property taxes.

Comment by anon2 Wednesday, May 1, 19 @ 11:56 am
Current law does not allow school districts to levy or pay for TRS from the uncapped pension fund (IMRF and Social Security are allowed). When a district picks up teacher contributions, that money comes from the Ed Fund. If the GA shifted the employer portion of TRS to the districts, that would come from the Ed Fund as well unless the tax levy fund law were to be changed as well.

Comment by Pot calling kettle Wednesday, May 1, 19 @ 12:18 pm
Lots of schools do not benefit from the new funding formula (by design) and continue to rely on local property wealth which allows money to be driven to the least adequate districts- plus, the new formula which is “scheduled” to have the $350 million input is reliant on local revenue in order to ensure that the scheduled $350 is even “adequate” -badly flawed idea…

Comment by Elliott Ness Wednesday, May 1, 19 @ 12:49 pm
Ness= You are very correct …sadly so

Comment by theCardinal Wednesday, May 1, 19 @ 3:01 pm
If the plan was to freeze only on Districts at or above 100% adequacy, it would be the the ballpark of something reasonable. But, to hamstring a district at, for example 60% adequacy and not let them at least match inflation is wrong-headed in so many ways. Yes, the state should be doing more and needs to be doing more, but at least let some of these way underfunded districts get closer to what the state itself says they need.

Comment by Right Field Wednesday, May 1, 19 @ 3:05 pm
I like the idea behind the bill but unfortunately property tax freezes end up being worthless. Hate to agree with Jim Oberweis but this is a gimmick and here’s why:

1) You can freeze the rate but school districts can still make up for it by forcing assessments to rise. You need to address, the rate, levy, and assessments together or a “property tax freeze” isn’t a freeze.

2) Even if the previous part wasn’t true there is this: “Taxes needed to pay debt service and pensions would be exempt from the freeze.” Ok… well the biggest driver right now is pensions and pension debt sooooo the bill doesn’t really do anything.

Comment by Boone's is Back Wednesday, May 1, 19 @ 4:16 pm