On Aug. 5, the Illinois Senate passed Senate Bill 318 by a vote of 37 yes, 1 no, and 18 present. Thirty-six votes were needed to pass. Among other things, the bill, if enacted into law, would freeze property taxes that School Districts 65 and 202 could levy in levy years 2017 and 2018 to the amount levied in tax levy year 2016, unless voters approved a higher amount in a referendum. Senator Daniel Biss (D, Evanston) voted “yes.”
While the tax freeze would be for two years, it has a significant continuing effect because School Districts 65 and 202 are subject to property tax caps, which limit the amount by which they may increase property taxes to the lesser of 5% or the amount of the increase in the Consumer Price Index. Freezing property taxes for two years reduces the base from which property taxes may be increased on a permanent basis going forward.
Under SB318, the City of Evanston would also be subject to the property tax freezes.
Senate Bill 318 also provides that the State will pay $197 million to the Chicago teachers’ pension fund for fiscal year 2016, and it requires that a portion of the Chicago Board of Education’s tax levy be earmarked for teacher pensions.
The bill makes some changes to the State’s current formula to fund education, which would direct a portion of the State funding to poorer school districts in the State for the next few years. Significantly, though, the bill would also repeal the State’s formula used to distribute general State aid for education on June 1, 2017.
To fill the void, SB318 would establish a bipartisan committee to propose a revised school funding formula no later than Dec. 31, 2016. The bill provides, “The Committee must establish a funding formula that provides adequate, equitable, transparent, and accountable distribution of funds to school districts that will prepare students for success after high school.”
If the Committee submits its report on Dec. 31, 2016, it would give the legislature and the Governor a short time within which to adopt a new method of funding education in the State. Or, they could extend the repeal date.
SB318 has moved to the House of Representatives. Speaker of the House Michael Madigan has not voiced support for the bill. The House has scheduled a hearing for the bill on Aug. 12 at 9:30 a.m.
Gov. Bruce Rauner reportedly does not support the bill as presented because it does not authorize local governments to limit the issues that may be collectively bargained with employee unions and the right to opt-out from the Prevailing Wage Act.