JOLIET – The effect of a potential two-year property tax freeze for Joliet Township High School District 204 could lead to a loss of about $8.8 million.
That was one of the financial projections presented by Forecast5 Analytics at Tuesday’s school board meeting based on what state lawmakers and Gov. Bruce Rauner have been discussing during state budget talks.
Losing almost $9 million over a property tax freeze is significant, said Ilandus Hampton, the district’s assistant superintendent for business services.
“You never get those dollars back,” Hampton said.
Superintendent Cheryl McCarthy said there’s been state-level talks of a two-year or permanent property tax freeze. Steve Crouse, Forecast5 senior analytics adviser, said a permanent tax freeze would push Illinois into a “referendum state.”
“If you want to increase your revenues, you have to pass a referendum,” he said.
Besides a property tax freeze, other factors that could affect the district in the future considered by Forecast5 were changes to the general state aid formula, a Teachers Retirement System cost shift and the lack of a state budget.
According to Forecast5, the district is expected to have a surplus of $335,804 this fiscal year and $341,947 in fiscal 2018, but to drop to a surplus of $1,042 in fiscal 2019.
The district is projected to have budget deficits in fiscal 2020 and beyond – from $481,827 in 2020 to $1.5 million in 2022 – but Crouse said they were not very large, and significant changes in state funding probably will occur before 2021 or 2022.
The Forecast5 presentation noted that 68 percent of the district’s revenue came from property taxes and 9 percent came from other local revenue. Salaries and benefits make up 76 percent of the district’s expenses.
Existing overall assessed property values and new property growth is expected to increase over the next five years. Student enrollment also is projected to increase, from 6,441 students this year to 7,111 in 2022.
The board on Tuesday approved two resolutions to issue $7.5 million and $18 million in general obligation bonds.
For the $7.5 million in general obligation refunding school bonds, the district plans to refund the Series 2007C referendum-approved bonds for savings. The savings for taxpayers is expected to be $143,000, the district said.
For the $18 million in general obligation limited tax school bonds, the district will sell $7 million in bonds for capital projects while refunding $11 million of the outstanding Series 2007A and B bonds for savings, which is estimated to be $930,000.
The latter bonds will carry an Aa3 rating from Moody’s Investors Services. According to Moody’s, bonds rated Aa are judged to be of a high quality and subject to low credit risk.