ALLIANCE LEGISLATIVE REPORT (100-21)
LAST SCHEDULED DAY OF SESSION; TAX FREEZE
Today is the last scheduled day of the spring legislative session and there is still no budget
agreement in sight. The Senate has sent a spending plan, along with new revenues through
proposed tax increases, to the House. House leadership is mulling their options of whether to entertain the Senate plan or craft their own and send it back across the rotunda to the Senate. The Governor has not been actively engaged with either chamber in brokering a budget deal this week and will likely not agree to anything that has been on the table this week.
A House committee last night approved an amendment to SB 1, the school funding reform bill, and sent it out to the House floor. A second amendment is expected today to make more tweaks to the evidenced-based funding formula. With the added amendments, if the bill is approved on the House floor today it will have to be sent back to the Senate for concurrence in the House amendments.
SENATE APPROVES PROPERTY TAX FREEZE
On Tuesday, the Senate approved a bill that would freeze the property tax extensions for school districts for two years. SB 484, which only applies to school districts, would not allow a district's tax extension to be any more in levy years 2017 and 2018 than it was in levy year 2016 without voter approval. Another bill, SB 482, would add these same limitations to other units of local government. The limitation would not apply to the payment of principal and interest on bonds or contributions to a pension fund.
SB 484 does include a financial hardship exemption for school districts that meet certain criteria. If a school district meets one or more of the following, it can apply to the State Superintendent of Education for an exemption from the tax freeze:
- the equalized assessed valuation (EAV) of the district has decreased by 10% or more compared to the EAV for the previous school year;
- the average daily attendance (ADA) of the district has decreased by 5% or more compared to the ADA in the previous year;
- 50% or more of the pupils enrolled qualify for free or reduced lunch;
- 20% or more of the pupils enrolled have an individualized education plan (IEP);
- the district has been identified as being on financial watch status for Fiscal Year 2016.
The bill has been assigned to the House Executive Committee but at this time, no hearing has been set.
A property tax freeze has been one of the agenda items Governor Bruce Rauner has insisted upon before he approves a budget. However, his position is that if income tax rate increases are to be made permanent, then the property tax freeze should be permanent as well. He has indicated that he would oppose a temporary property tax freeze.
ALLIANCE MEMBERS ARE URGED TO CONTACT THEIR STATE REPRESENTATIVE AND ASK THEM TO VOTE "NO" ON SB 484 OR ANY PROPERTY TAX FREEZE FOR SCHOOL DISTRICTS.