McHenry County Blog

Educators know that people don’t notice sales taxes, so they convinced the Illinois General Assembly to enact legislation to allow sales taxes to be raised and designated for schools.

People would be told that property taxes would be cut, but I’ve watched such false promises since the early 1970′s the Resource Equalizer State Aid to Education Formula was passed.

It funneled hundreds of million of dollars into schools.

In return, dual (grade and high school) districts were mandated to lower their property tax rates in a couple of years.

Did that happen?

No.

Instead the school folks came in and repealed the requirement that real estate tax rates be rolled back to compensate for the increase in State Aid.

As I noted when the bill was first passed, as soon as money was borrowed using the stream of sales tax as the repayment mechanism, there would be no way to repeal the tax.

Since all school districts in the county would be in on the bonanza, the tax would never disappear. Some district would always have outstanding building or repair bonds.

There was one saving grace in the original law.

County Boards had to agree to put the referendum on the ballot.

If they did not, the sales tax hike referendum obviously could not pass.

Now, tax hike-minded educators have convinced the Senate and the House to pass Senate Bill 2170.

Locally both State Senator Pam Althoff and Dan Duffy voted for to get rid of this “check and balance.” You see the 35-16 l call below:

The Senate roll call for SB 2170.

In the Illinois House, the overwhelming 78-39 vote was split for State Representatives covering McHenry County.

The House roll call on SB 2170.

State Reps. Jack Franks and Mike Tryon voted “No.” State Rep. Mark Beaubien voted for the bill. The roll call follows:

In Southeastern Illinois lies the County of Lawrence. I subscribe to the Sumner Press and saw the ad you see below:

The required referendum passed 1,557 to 1,385, according to Daily Record.

Money collected from the new tax will be distributed to all local school districts in proportion to the number of students in each district.

Once bonds are issued, the tax cannot be abolished until the bonds are paid off.

That, of course, means never.

Two Thursdays before the election (January 21, 2010), one of the local school superintendents wrote this letter to the Sumner Press:

Dear Editor:

Our elected school board members are obligated to assure our community the best possible school systems and facilities, all without excessive burdens on taxpayers. To balance our educational needs and costs is a difficult task.

On February 2, voters of Lawrence County will decide whether a 1% hike in sales tax on certain items (not the most essential) is the best solution to provide much needed improvements and upgrades to our school buildings and facilities.

The referendum on a County School Facility Sales Tax is the result of legislation sponsored by State Representative Roger Eddy and passed by our Legislature which, if approved by our voters, gives us a chance to assure needed improvements to our school facilities (including Lawrenceville High School) and for retiring bonds for Unit 10 construction, without raising taxes on essential items such as groceries, medical drugs and appliances, licensed vehicles, agricultural supplies and machinery, and without raising property taxes.

As taxpayers, we have created a Capital Development Fund which will pay 60% to 70% of the cost of such needed improvements and construction. But if we do not have the necessary “matching funds” (30 or 40% of the costs), our tax money is left on the table for other communities to obtain the facilities we need. The proposed sales tax on other items will provide the needed matching funds.Please attend the Public Forum at the Lawrenceville Central Christian Church this Thursday, January 21, at 5:00 p.m., to hear Rep. Eddy and school officials explain the effect of your vote. Please be an informed voter.

Our community needs, and cannot afford to lose, the educational upgrading and facilities this proposal will provide. I urge a “Yes” vote.

Sincerely,

Philip B. Benefiel

Can you see why I wrote my former legislative colleague, now Publisher Roscoe Cunningham and told him the superintendent was “math impaired.”

I wrote,

“He apparently thinks a one percentage point increase in the local sales tax is the same as a ’1% hike in sales tax.’ (See letter posted online: ‘On February 2, voters of Lawrence County will decide whether a 1% hike in sales tax on certain items (not the most essential) is the best solution to provide much needed improvements and upgrades to our school buildings and facilities.’)

“Really!

“Let’s assume the local sales tax is 6.25%. If so, dividing one percentage point by and a quarter percentage points would yield a 15% sales tax hike.

“Politicians lie all the time about political issues, but wouldn’t you think a school superintendent would tell the truth?

“Or, doesn’t he really know the difference?

“I don’t know which is worse, deliberate deception or not knowing enough about percentages to get out of junior high school.

“Wishing we lived closer together and enjoying your now self-identifed weekly views of the world.”

And he published it with this reply,

“Cal, you are too hard on Supts. Seaton and Steagall. Each is a straight arrow. Antecedent on the numbers isn’t clear.

“We yet remember and appreciate the skill with which you skewered the ‘bad guys,’ across the aisle, in the General Assembly.

“Local GOP, to use Paul Powell’s line, ‘smell the meat a cookin’,’ are confident that either McKenna, Dillard or Ryan will win November 2.

“See you in Springfield for victory celebration.

“Best to you and family,

“roscoe”

I can’t wait for school districts to try this in McHenry County. Rest assured that every county board member who votes to put such a referendum on the ballot will think my McHenry County Republican Cat Tax campaign was mild.

School folks throughout Downstate (let’s use the old definition of “everything outside of Cook County”) will be talking about Champaign County’s having just passed a sales tax to fund school construction and remodeling in this low turnout election.

I learned by reading the election round-up article on Illini Pundit.

The one percentage point school sales tax passed 53-47, by about 1,550 votes countywide. It will raise $18 million a year, if the county board goes along.

Differential turnout is what elections are all about. He that get his voters to the polls wins the election.

Last November, the educational sales tax proposal failed in Champaign County by 262 out of almost 77,000 votes cast. School districts were marshalling their forces during the spring, this story reports. Here’s the fall campaign.

Lake County educators have discussed a similar proposal, but backed away from a countywide referendum last year.

Mayor Aaron Shepley’s 75% city sales tax hike and DuPage County Republicans and other legislator’s tripling of the RTA’s sales tax in McHenry County is probably all that kept local educators from making a similar proposal.

WCIA-TV says that the referendum was “an advisory referendum” and that “County Board members say they plan to vote in line with what voters want. But legally, they can lower the tax amount or strike the idea all-together. Schools understand the battle isn’t behind them yet.”

If you would like details on what the new school sales tax law allows, take a look at this story.

Note from the logo above that the school people do not know the difference between one percent and one percentage point. Their proposal was most certainly a one percent sales tax increase. They are not the only math-impaired liberals in Illinois.

If you got a school newsletter that usually came at the end of November right before the election and it included the following column, would you think the school district was spending tax dollars to convince you to vote in favor, even though no where do the words, “Vote Yes,” appear?

Just wondering if you thought this was an appropriate use of tax dollars.

This was sent out right before the sales tax hike referendum by Unit District 4 in Champaign County.

Since at least the folks in Champaign County get to vote before they have a mega sales tax hike, I guess I should cut them some slack.

Mayor Aaron Shepley’s Crystal Lake City Council did not allow a referendum on whether or not to raise the city sales tax 75%.

= = = = =
Thanks to Champaign County Board candidate Corben Rice for taking the time to scan and send me this part of the school newsletter.

If you got a school newsletter that usually came at the end of November right before the election and it included the following column, would you think the school district was spending tax dollars to convince you to vote in favor, even though no where do the words, “Vote Yes,” appear?

Just wondering if you thought this was an appropriate use of tax dollars.

This was sent out right before the sales tax hike referendum by Unit District 4 in Champaign County.

Since at least the folks in Champaign County get to vote before they have a mega sales tax hike, I guess I should cut them some slack.

Mayor Aaron Shepley’s Crystal Lake City Council did not allow a referendum on whether or not to raise the city sales tax 75%.

= = = = =
Thanks to Champaign County Board candidate Corben Rice for taking the time to scan and send me this part of the school newsletter.

McHenry County Blog alerted readers to the new law allowing school districts to seek a sales tax to finance repairing and building schools way back in late January.

Lake County flirted with the idea, but nothing has appeared about discussions locally in any of the local newspapers.

The major problem with the tax is that once it is approved, it stays forever.

At least, that’s my interpretation. Once bonds are sold, since the tax is pledged to repay them, any area that votes for the tax is stuck.

So locally, with Mayor Aaron Shepley’s city council already having hiked the city sales tax 75% (no problem—Algonquin’s is as high), any increase for schools brings use still closer to challenging Chicago for the highest sales tax in the country.

A one cent sales tax increase is on the ballot in Champaign County and, thanks to Illini Pundit here are arguments pro and con presented by the local chamber of commerce.

Reasons to Cast a “Yes” Vote

• If passed, will provide a guaranteed funding stream for the ongoing maintenance of facilities that are currently paid for by property taxes;
• It may help schools to become more energy efficient and be usable longer;
• There is a potential decrease in property taxes;
• Improved facilities may help with recruitment and retention of quality educators;
• It may help to solve many of the maintenance issues in many of the school districts and lessens the need for schools to seek future referendums;
• It may free up other monies in school districts’ budgets that could be applied to educational programming;
• Improved facilities could potentially draw new families resulting in additional workforce talent for other area employers.

Reasons to Cast a “No” Vote

• This is a tax increase, not a tax swap. Property tax abatements are not guaranteed under this law and a sitting school board can not bind future boards to promises they made;
• There is no adequate sunset provision in the legislation. If passed, the additional one cent sales tax will be in place indefinitely;
• It does not solve all of the capital needs of the school districts. School districts can and will seek future property tax referendums for large-scale projects;
• While the tax increase may alleviate the financial burden on district budgets for physical facilities, it does not address educational programming, and proof of a correlation between maintained facilities and improved educational performance has not been presented;
• There may be less accountability by the schools to the voters. The residents will no longer have a vote on how large sums of tax dollars will be spent on capital maintenance issues;
• There is no mechanism in the current law which prevents the state from withholding state capital funds from communities that pass this sales tax;
• There is a lack of empirical data to prove that newer quality facilities will drive economic development and bring new business to our community.

Locally, State Senator Pam Althoff and Chris Lauzen voted “No,” while State Senator Bill Peterson voted “Yes” on the final 31-24 vote.

The bill passed the Illinois House 74-41. State Representative Jack Franks and Mike Tryon voted against the bill. Mark Beaubien was listed as not voting. Tim Schmitz voted “Yes.”

McHenry County Blog alerted readers to the new law allowing school districts to seek a sales tax to finance repairing and building schools way back in late January.

Lake County flirted with the idea, but nothing has appeared about discussions locally in any of the local newspapers.

The major problem with the tax is that once it is approved, it stays forever.

At least, that’s my interpretation. Once bonds are sold, since the tax is pledged to repay them, any area that votes for the tax is stuck.

So locally, with Mayor Aaron Shepley’s city council already having hiked the city sales tax 75% (no problem—Algonquin’s is as high), any increase for schools brings use still closer to challenging Chicago for the highest sales tax in the country.

A one cent sales tax increase is on the ballot in Champaign County and, thanks to Illini Pundit here are arguments pro and con presented by the local chamber of commerce.

Reasons to Cast a “Yes” Vote

• If passed, will provide a guaranteed funding stream for the ongoing maintenance of facilities that are currently paid for by property taxes;
• It may help schools to become more energy efficient and be usable longer;
• There is a potential decrease in property taxes;
• Improved facilities may help with recruitment and retention of quality educators;
• It may help to solve many of the maintenance issues in many of the school districts and lessens the need for schools to seek future referendums;
• It may free up other monies in school districts’ budgets that could be applied to educational programming;
• Improved facilities could potentially draw new families resulting in additional workforce talent for other area employers.

Reasons to Cast a “No” Vote

• This is a tax increase, not a tax swap. Property tax abatements are not guaranteed under this law and a sitting school board can not bind future boards to promises they made;
• There is no adequate sunset provision in the legislation. If passed, the additional one cent sales tax will be in place indefinitely;
• It does not solve all of the capital needs of the school districts. School districts can and will seek future property tax referendums for large-scale projects;
• While the tax increase may alleviate the financial burden on district budgets for physical facilities, it does not address educational programming, and proof of a correlation between maintained facilities and improved educational performance has not been presented;
• There may be less accountability by the schools to the voters. The residents will no longer have a vote on how large sums of tax dollars will be spent on capital maintenance issues;
• There is no mechanism in the current law which prevents the state from withholding state capital funds from communities that pass this sales tax;
• There is a lack of empirical data to prove that newer quality facilities will drive economic development and bring new business to our community.

Locally, State Senator Pam Althoff and Chris Lauzen voted “No,” while State Senator Bill Peterson voted “Yes” on the final 31-24 vote.

The bill passed the Illinois House 74-41. State Representative Jack Franks and Mike Tryon voted against the bill. Mark Beaubien was listed as not voting. Tim Schmitz voted “Yes.”

I hadn’t noticed that some Lake County schools were trying to get permission for more tax dollars through the imposition of at one percentage point countywide sales tax.

First, congratulations to Chicago Tribune reporter Tara Malone for not reporting that it was a “one percent” sales tax increase.

Too many reporters don’t know the difference between a percent and a percentage point.

McHenry County Blog reported on this new tax hike opportunity way back in January. I wish I could tell you I discovered it myself. It was an alert reader who told me about this threat.

The story says that only voters in Downstate Williamson County has approved the new sales tax.

The bad news for Lake County taxpayers?

The proposal is likely to be resurrected in 2009. The voter turnout will be lower then, don’t you know?

I hadn’t noticed that some Lake County schools were trying to get permission for more tax dollars through the imposition of at one percentage point countywide sales tax.

First, congratulations to Chicago Tribune reporter Tara Malone for not reporting that it was a “one percent” sales tax increase.

Too many reporters don’t know the difference between a percent and a percentage point.

McHenry County Blog reported on this new tax hike opportunity way back in January. I wish I could tell you I discovered it myself. It was an alert reader who told me about this threat.

The story says that only voters in Downstate Williamson County has approved the new sales tax.

The bad news for Lake County taxpayers?

The proposal is likely to be resurrected in 2009. The voter turnout will be lower then, don’t you know?

Some variation of a sales tax for schools is being pitched in Champaign County.

Only the DuPage County Republican-imposed tripling of the RTA sales tax rate and Mayor Aaron Shepley’s 75% Crystal Lake city sales tax hike has probably suppressed similar cries in McHenry County.

Illini Pundit reports that the Urbana School Board supports a sales tax hike:

“With its vote, 11 school districts in the county have now passed such a resolution. Those districts represent almost half of the county’s school enrollment, said Jane Quinlan, superintendent of the regional office of education. State law provides that districts representing at least 51 percent of the county’s school enrollment can place a tax question on the ballot by approving a resolution such as Urbana did,”

according to what used to be called the Champaign News-Gazette.

Mahomet has had a hearing.

Urbana is on board.

Add in the Unit 7 School Board.

Rantoul supports the referendum, too.

Same with Savoy.

Tolondo liked the idea.

“It’s a win-win for everybody,” (Michael) Shonk said. “I think it’s a good thing,” according to the News-Gazette.

Here’s part of my January analysis of the proposal:

Who will be the winners and the losers?

My first take is that those areas that are built out will be the losers. They will tend to have paid for their schools.

The winners, if I am correct, will be the fast growth areas, the villages that lust for growth.

I see one intended consequence and one unintended consequence.

Once a flow of money starts and one school district sells bonds based on these sales tax receipts, the tax seems destined to stay forever.

The unintended consequence is that tax money will flow forever (so to speak) and the local school boards will find a way to spend, whether such expenditures are necessary or not.