U-46 weighs tax levy hike

By Tara Malone Daily Herald Staff Writer
Posted 10/26/2004

Hoping to hit a financial bulls-eye, Elgin Area School District U-46 leaders considered Monday night whether to fire off a bid for $236.6 million in property taxes this year.

If approved, the proposed levy would be a 14.3 percent jump from the $207 million U-46 collected in property taxes last year.

Such an increase would not ratchet up the tax rate, but would ensure the district collects every penny it's due.

Talk of tax levies and revenues came as district officials on Monday night reported saving pennies - about $475,000 of them a year, to be exact - because of fewer bus routes, a consequence of the new U-46 boundary map that unrolled last summer.

The number of hours driven on district buses each day clocked in at 2,084 this year, down from 2,203 hours last year, district officials said.

Despite financial savings in busing of regular education students, transportation for youngsters in preschool and special education programs was up, U-46 Chief Financial Officer John Prince said.

The total cost of extra runs for students in special programs could cost the district between $650,000 and $700,000, Prince said, though the state would repay U-46 for such expenses.

"Overall, we believe the boundary changes in the district have resulted in financial savings for the district," Prince said.

Such gains aside, Prince noted, U-46 leaders must safeguard the district's financial future.

And setting an ambitious tax levy is one way to do it.

Because the district's property wealth is unknown and revenue from new home construction uncertain, pegging a levy amount, Prince said, is much like hedging a bet.

Or gazing into the future, Superintendent Connie Neale said.

"We don't have a crystal ball to really know what is going to be available," Neale said.

For that reason, Prince told school board members, the levy, "must be high enough so as not to run the risk of leaving revenues on the table that we might otherwise be entitled to."

School districts typically balloon levy amounts so as to capture any gains in property values or new development in its tax revenue.

As homes increase in value and number, the district's tax base broadens. A larger tax base fills U-46 coffers with more money without necessarily boosting tax rates.

In truth, the $236.6 million levy is more than U-46 likely will receive.

The districts may only boost last year's tax extension by 1.9 percent, or the estimated inflation rate, Prince said. Allowances for new construction could bump the cap to 3.5 percent.

That is to say, U-46 could increase last year's $207 million levy by $7.2 million rather than the proposed $29.6 million.

Such numbers might change as the year unfolds. Inflation could ebb or flow, as could the pace of development.

With that in mind, school board member Robert Wise said, "I think 15 percent is probably a good number to be at. I think it's safe."

A public hearing on the proposed tax levy will be held at 7 p.m. Monday, Nov. 17.