Crack researcher Susan Handelsmann of rural Woodstock has put together a “how to” piece about figuring out what your school board has done with school finances.
The McHenry Grade School Board before the last election.
It is presented below for McHenry Grade School District 15, but can be adapted for any Illinois school district.
1. Equalized Assessed Value (EAV) for District 15 can be found here (around page 14):
Assessed value in McHenry Elementary School District 15 for 2012, 2013 and 2014. Taxes are collected on assessed value in the year after the assessment year.
- 2012: $988,568,670
- 2013: $873,569,186
- 2014: $838,788,387
You can see the downward trend. This is the denominator in the tax rate equation [the bottom number], so the lower the EAV, the HIGHER the TAX RATE.
[I would add that under the Tax Cap, tax rates were pushed down as the increases in assessed valuation exceeded the rate of inflation. That means the tax rates of most tax districts fell well below the limits imposed by state law. The impact since property values plunged has been that most tax districts ask for the maximum increase allowed, that is, the entire increase in the Consumer Price Index (CPI) and get it. That pushes the tax rate higher and higher.]
2. Note that in McHenry there is a Tax Increment Financing District (TIF) district skimming off the taxes on nearly $3 million of EAV.
School district boards are nearly the only defense against TIFs. You must become well-versed on this topic if you are not already.
3. In order to research bond details, bond debt totals and statutory debt amount caps, you may look in two places.
These are great resources for all manner of financial research on school spending.
that is the muni bond posting site. The McHenry Grade School district is CUSIP number 580781
enter your CUSIP (Committee on Uniform Securities Identification Procedures) number in search box. this will display debt instruments of this issuer.
in the grey toolbar above issue details select “official Statements’
Click on the pdf to download it.
It is a long document but once you get used to looking at them, you will find it less daunting.
The first part of the document has debt amounts and debt ratios (grade and high schools are limited by statue to borrow only 6.8% of EAV (13.6% for unit school districts).
But there are many loopholes for borrowing and schools use them a lot.
Further in document you should see all details of all outstanding debt.
**NOTE! the outstanding debt listed in statutory debt limit calculation is PRINCIPAL ONLY!!
SO if you see a bond with the same principal amount as when it was issued, check out how much unpaid interest may have accrued. This is Phantom Debt and it is very popular with schools to hide the true picture, and evade statutory borrowing caps.
This is where you will find budgets filed for the past several years.
You will want to look at these two documents for your school:
There are many page tabs with relevant data.
For example: PCTC_OEPP page 28-29 (you have to scroll to the right on bottom tabs).
This gives Operating Expense Per Pupil.
Yours is $12,007. State average is around $10,000. ( *Note the number includes certain debt service)
4. Real estate data: See
Many sold homes in the under $20,000 price range.
This drags down EAV, and everyone appeals assessments, and the vicious downward cycle continues.
*Note that as our tax rates are 2-3 times that of national average, and at least double Chicago’s property tax rates, people may have trouble qualifying for a conventional mortgage. look at median household income and median home value differentials on a mortgage calculator.
Also calculate the amount of median household income spent on a median value home’s property taxes annually, as a percentage of income.
It is a stunning, horrifying figure when compared to national averages.
It means that families have to divert a huge chunk of household income to pay annual property taxes, and that money is then not available for other spending or saving categories…but almost anywhere in America that household would be paying only 3.6% of their household income to property taxes. (In Woodstock D200, 14% of household income must go to pay property taxes).
5. Woodstock is in a similar death spiral of property values. If you can find a winning formula to conquer school board runaway spending we might try it out here, too.
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See also The School Employees on the McHenry Grade School Board