Post by title1parent on Dec 9, 2008 6:21:18 GMT -5
www.suburbanchicagonews.com/napervillesun/news/1320753,Naperville-Indian-Prairie-eyes-tax-levy_na120908.article
Indian Prairie eyes $240 million tax levy
December 9, 2008
By TIM WALDORF Staff Writer
Indian Prairie School District 204 expects to levy nearly $250 million in property taxes to help fund the 2009-2010 school year.
After approving a tentative tax levy during its Nov. 10 meeting, the District 204 board approved a 2008 levy that asks Will and DuPage county clerks to grant it the authority to collect $248 million in property taxes, which equates to slightly more than an 8 percent increase over its 2007 collection of roughly $228 million.
However, the district expects the clerks to authorize a levy increase of about 5.3 percent, or $240 million, after tax cap calculations are finalized in April. Roughly $212 million of that total will go toward operating expenses. The rest – roughly $27.9 million – will go toward debt repayment. That portion of the levy, which is known as the bond and interest levy, will be $6 million less than originally projected due to abatements the district will make under its referendum promise of three years ago to restructure its debt repayment levels.
The tax cap law uses the inflation rate to limit districts' abilities to increase the amount of property tax revenue they collect from year to year. This year, the inflation rate is 4.1 percent, which means the district will be allowed to collect no less than about $237.6 million. Any revenue in excess of the $237.6 million will come from new construction, which is not subject to the tax cap, and which will not be known until April.
That's why tax levy figures for school districts are often inflated. Districts ask for significantly more money that they know they'll be allowed to collect – a practice called balloon levying – to make sure they get every cent the tax cap law allows.
The reason for such a practice is under the tax cap, any money left on the table one year is not just lost that year – that amount compounds each year, growing according to the inflation rate.
Also, when the value of a district's tax base increases at a rate greater than that of inflation, the district's tax rate drops. This year, the district expects total equalized assessed value to increase 6.43 percent.
So, even though it plans to increase the amount of money it will collect by roughly $12 million, District 204 also expects the tax cap to reduce its tax rate from $4.49 cents per $100 of EAV to about $4.45.
The decrease in the tax rate caused by the tax cap is likely to offset the increase in EAV this year, meaning the typical District 204 resident's tax bill will likely increase at about the rate of inflation – or 4.1 percent.
Indian Prairie eyes $240 million tax levy
December 9, 2008
By TIM WALDORF Staff Writer
Indian Prairie School District 204 expects to levy nearly $250 million in property taxes to help fund the 2009-2010 school year.
After approving a tentative tax levy during its Nov. 10 meeting, the District 204 board approved a 2008 levy that asks Will and DuPage county clerks to grant it the authority to collect $248 million in property taxes, which equates to slightly more than an 8 percent increase over its 2007 collection of roughly $228 million.
However, the district expects the clerks to authorize a levy increase of about 5.3 percent, or $240 million, after tax cap calculations are finalized in April. Roughly $212 million of that total will go toward operating expenses. The rest – roughly $27.9 million – will go toward debt repayment. That portion of the levy, which is known as the bond and interest levy, will be $6 million less than originally projected due to abatements the district will make under its referendum promise of three years ago to restructure its debt repayment levels.
The tax cap law uses the inflation rate to limit districts' abilities to increase the amount of property tax revenue they collect from year to year. This year, the inflation rate is 4.1 percent, which means the district will be allowed to collect no less than about $237.6 million. Any revenue in excess of the $237.6 million will come from new construction, which is not subject to the tax cap, and which will not be known until April.
That's why tax levy figures for school districts are often inflated. Districts ask for significantly more money that they know they'll be allowed to collect – a practice called balloon levying – to make sure they get every cent the tax cap law allows.
The reason for such a practice is under the tax cap, any money left on the table one year is not just lost that year – that amount compounds each year, growing according to the inflation rate.
Also, when the value of a district's tax base increases at a rate greater than that of inflation, the district's tax rate drops. This year, the district expects total equalized assessed value to increase 6.43 percent.
So, even though it plans to increase the amount of money it will collect by roughly $12 million, District 204 also expects the tax cap to reduce its tax rate from $4.49 cents per $100 of EAV to about $4.45.
The decrease in the tax rate caused by the tax cap is likely to offset the increase in EAV this year, meaning the typical District 204 resident's tax bill will likely increase at about the rate of inflation – or 4.1 percent.