No consensus yet on Danville school tax options
DANVILLE — The school board next week will vote on whether to adopt a proposed 2013 tax levy for the Danville school district.
The Danville School Board will meet at 6:30 p.m on Wednesday at the Jackson Building, 516 N. Jackson St., Danville. A copy of the agenda is available online at http://bit.ly/18otrRl.
After considering four tax-levy options for more than a month, members still haven't reached a consensus.
Some are leaning toward the one recommended by administrators. That option would raise the tax rate slightly but wouldn't bring in any new money next year because of a projected decrease in property values.
"I think that's the best one, and I think it will be supported by the board," board President Bill Dobbles said of the option, which would generate about $17.32 million in local revenue. 'We won't get any more tax dollars, but we won't get any fewer tax dollars.
"And it will give us what we need for our restricted funds," Dobbles continued, referring to the Illinois Municipal Retirement, Social Security and tort funds. "Any money we raise for those funds can only be used to pay those bills. If we don't levy enough money for those funds, we'll have to take it out of the education fund. That would be doing our students a disservice."
But two members — Frank Young and Steve Bragorgos — have been very vocal in their opposition to even the slightest tax hike.
"What that will do is increase real estate taxes in a time when our community can't afford it," said Young, who's still smarting over the board's decision earlier this year to give administrators raises and extend a retirement incentive giving them a 6 percent boost each year during the last three years of their service, following the ratification of a teachers' contract that provided the same for certified and non-certified staff.
"We're going to see a reduction in our (equalized assessed valuation of property), and there's going to be a reduction next year, too," Young said. "I think it's arrogance on the part of the administration to do this, and I think it's absolutely irresponsible of the board to do this at a time when this community is struggling."
Property taxes make up about 32 percent of the district's revenue. Vermilion County officials are projecting a 3.6 percent decrease in property values in the district, although the actual amount won't be known until next spring.
That's one of the reasons administrators, who presented four options in October, are recommending one that would levy no increase for the district's restricted funds — education, fire prevention/safety, operations building maintenance, transportation, working cash, special education and technology lease.
"That would negate our risk of losing any money if there is less of a decrease in" property values, business and finance Director Heather Smith said.
Under that option, the district would levy slightly higher rates than it did in 2012 for IMRF to raise about $1.2 million and tort to raise about $1.4 million. It would levy a slightly lower rate for Social Security to raise $981,342.
"Right now, we have a 0 balance in IMRF, and we're going down in tort by over $300,000 a year," Smith said, explaining the need for the higher rates.
Earlier this year, the district had to borrow from the education fund to cover shortfalls in those funds.
Superintendent Mark Denman pointed out next year's decrease in property values could be lower than anticipated, as it was this year. The steady decline has resulted in nearly a $2.76 million loss in local revenue for the district since the 2009-10 fiscal year, including $918,098 this year.
Danville school district's tax levy options:
Option 1: The district would raise the amount it needs — about $17.55 million, a $229,000 increase over this year's amount.
The tax rate would be about $5.38 per $100 of assessed valuation. The owner of a $66,500 house — the average home value in the city — would pay about $869 to the district, a $50 increase over this year, if the home value stays the same.
Option 2, recommended by administrators: The district would raise about $17.32 million.
The rate would be about $5.31 per $100 of assessed valuation, up from last year's rate of about $5.06. The owner of a $66,500 home would pay about $858 to the district, a $39 increase over this year, if the home value stays the same.
Option 3: The district would levy the same amount as last year, generating about $16.93 million or $397,000 less than this year.
The owner of a $66,500 home would pay about $838 to the district, a $19 increase over this year, if the home value stays the same.
Option 4: The district would keep the same rate of $5.06 per $100 of assessed valuation. (The district doesn't set the rate; the county clerk does that based on the levy and the tax base.) That's the least popular option among administrators because it would bring in the least amount of revenue — $16.53 million, a $789,000 decrease from this year.