It seemed appropriate to start a new thread on the tax levy, although other threads here and elsewhere have included discussion of it.

The agenda for the November 26 District 41 Board meeting includes the Truth in Taxation Resolution. The actual public hearing to approve the tax levy will be at the December 10 meeting at 7:00 p.m.

Interesting article in the Daily Herald today regarding the tax levy debate in a neighboring district. Comments from one of the board member's who sought a lower requested amount: "To pass this levy amount would send a message to the taxpayer that we have a desire to take as much possible from the community," Cole said. "We're asking for this money without any documentation showing what we need the money for."

The District 41 board meeting on Monday, November 26 will be held at Lincoln Elementary school at 7:30 p.m.

(On a side note, the 11/1/07 enrollment report is posted. Current enrollment stands at 3,551. Without the 72 Pre-K students, we are at 3,479 down 60 students for one year ago.)

Interesting Article Ohma: It's nice to see somebody take the high road here. I don't mean to be negative, but what gives us the idea that 41 would be reasonable in their requirements after they refused to cough up the $$$$ scamed in the Phase In, unlike Hinsdale? If 41 had made a "token" effort to rebate some of the excess funds, you might have a believer in me. As to 87, I have a bit more hope with the current board. But remmember, believe it was all but 1 currently serving on the board that tried to pull a phase in over the publics eyes until parties concerned lobbied and pulled the plug on thier little manuever.

"Those who forget history are doomed to repeat it".

The notice of the hearing to approve the new levy indicates that they are estimating total amount of the taxes levied for 2007 to increase by 6.34%. Does this mean that they are trying to increase their tax rate by 6.34%? If so, doesn't this ignore the current reassessment of property values that is going on right now? Assuming most of Milton Township had their assessed value increase by somewhere around at least 5%, then wouldn't the result be at least an 11% increase in taxes collected by the district? Just asking 'cause I don't know.

There are two components to your tax bill:

1) assessed value and
2) tax rate

We all know what our assessed values are, but what has yet to be determined is the rate that gets applied to the assessed value. The tax rate will be determined by the amount of the tax levy. The tax levy is determined in part on what is being requested by our school district. I think they want their budget to increase by 6.34%, not necessarily the tax rate. Milton will simply adjust its rate to yield its enitre budget, including the 6.34% that our school district is asking for. Milton is simply going to back into what they want. Does this make sense?

It makes perfect sense if in fact that is how they do it. The tax system is like the sausage business, both are unappealing. So if I understand you correctly, if they ask for ~6% more then they should get ~6% more, regardless of whether Milton Township's collective assessment increase is + or - 5% from the previous year.

Fish,

Concerning your D41 taxes for next year, the actual tax rate is determined after the dollar amount because of the tax cap. I will explain in more detail later when I have a minute.

SV

The school district's budget is just one component of the overall levy. Essentially, if after all budgets are submitted, including the Village of GE, it's park district, library, etc., Milton determines Glen Ellyn needs $100K (hypothetically speaking), it will create a rate that when applied to the already assessed property values equals $100k. It's going to back into its final levy by adjusting the rate up or down.

The tax rate is the figure resulting from dividing the dollar amount required for the taxing district($100K) by the total value of all the property within the district. This is my understanding anyway.

I don't quite yet understand all the tax cap stuff and the allowable limits school districts can ask for without going to referendum. Our Bob Solak may have a better handle on that kind of stuff.

I do know I hate Milton.

I'm basing this post on my understanding of a book by James Fritts, entitled "Essentials of Illinois School Finance". If so inclined, you can purchase the book here.

quote:

A tax-capped district is limited in the maximum growth of its total operating fund property tax revenue (excluding bond and interest tax receipts).

Here are the steps he outlines for computing allowable tax extensions by Districts in counties under the tax cap, like DuPage (Cook Co. is its own beast, by the way). I would "quote" this, because its about 90% verbatim from the book, but I altered it a little.


Step 1: Compute the limiting rate for all operating funds

A. Multiply the previous years extension (all the property tax dollars received by the District except those in the bond and interest funds) by the inflation factor for the current levy year (for purposes of this discussion, the inflation factor is the Consumer Price Index (CPI)).

B. Subtract the value of new construction from the current years Equalized Assessed Value (EAV) of all taxable property in the District.

C. Divide the result of step A by the result of step B. The result is the limiting tax rate.


Step 2: Multiply the EAV for the current year by the limiting rate to determine the total extension for operating funds.


That will give you the total $$ the district can expect to get. What that means to individual tax bills is something for someone else to explain.

Here's the rub for levy votes. Boards have to vote on the levy amount in December. But in December, no one knows precisely what CPI will be nor do they know what the "new construction" value will be. That is all determined after the vote. What a District levies is different from what is actually received (extended).

So, if a tax-capped District is interested in ensuring all the revenue it can legally get, it will ask for more than it expects to get. Call it a balloon levy, "maximizing the revenue", or whatever term you like.

Refer to Attachment 2 (pages 4 and 5) of the Nov. 12 Board Meeting Packet, which has a report to the Board concerning the levy. The Administration expects the actual increase to be approx. 3.74% but is recommending we levy a 6.34% increase.

Thanks Bob. This is good info. So there is nothing that prevents D41 from asking for 10% or even 20%? It really depends on how much other taxing bodies are asking for as to whether D41 would get its requested amount. The bottom line is that if they are asking for more, chances are other taxing bodies are asking for more; therefore, it becomes more likely we will all be charged the maximum allowable under law.

I guess the point I was trying to make is that simply because your assessed value goes up or down, doesn't necessarily mean your tax bill goes up or down. It depends on the overall levy and the rate that's applied to your assessed value.

quote:

Originally posted by bitterboy:
So there is nothing that prevents D41 from asking for 10% or even 20%?

There's nothing that prevents the amount asked for, the tax cap just limits what a District winds up getting. The county clerk looks at the levy, runs the calculations, and lowers the amount of the levy accordingly. The sticking point is that the Clerk will lower it down, but he won't raise it. So, for instance if a District levies 3% and they could have gotten up to 3.5%, the Clerk will only give them the 3%.

The cycle/calculation starts all over again the following year, so if a District "loses out" on the 0.5% in the above example, they lose out on it "forever".

quote:

will It really depends on how much other taxing bodies are asking for as to whether D41 would get its requested amount.

Not quite. How much other taxing bodies request doesn't make a difference to what D41 requests or receives.

quote:

I guess the point I was trying to make is that simply because your assessed value goes up or down, doesn't necessarily mean your tax bill goes up or down. It depends on the overall levy and the rate that's applied to your assessed value.

I believe that is right. So if homeowner A's assessment went up 20% and homeowner B's assessment went up 5%, the percentage of increase in their individual tax bills due to D41 will be different. The tax cap applies to the total District extension amount, not individual tax bills.

You're a good man BS. Thank you for the info.

The tax cap is in place to keep taxes in check despite exploding EAV growth. With the passage of a ref, you are lifting the limitation of the rate for 1 YEAR. However, with the phase in, there were 4 additional years where the tax cap was nullified. So, as EAV is growing during this time period, the tax RATE is also growing. A two pronged attack on our wallets. rate x EAV= taxes

If the rate only went up 1.00 say, multiply this by the EAV. So, if your EAV increased by 150,000K, this translates to 1,500 additional in taxes per year. I know of 1 house in GE where their EAV doubled.

Maybe people will take note of the phase in and it's effect not only on the past 4 years but on the future as well.

How is it that the rate is growing too? All they have to do is increase one of the components of the equation to yield more money. With 2007's increase in EAV's, they can even afford to lower the rate a bit and still yield more $. Why is it going up too? I'm missing something here.

quote:

Originally posted by bitterboy:
How is it that the rate is growing too?

I don't think Gus was referring to this upcoming levy/extension.

It's not uncommon for the rate to actually decrease for tax-capped bodies while the EAV and tax bills are increasing (in the absence of referenda). I think its likely that the D41 rate will decrease next year, however, no one knows for sure until next calendar year when the Clerk makes the calculations. But when we get our tax bills, it's not really about the rates, is it? Its about the dollars.

To all: please see my MANY previous posts relative to a great many homes here in GE that were underassessed. Hell, one of our greatest proponents of school refs and a D87 board member sits on a property with a GROSSLY undervalued house. I wonder what it is now. How can one scream for more educational funds while not paying your fair share at the same time??? I've always said that this town will wake up when these tax rates start to truly reflect the MAJORITY of households in this town. Long timers and folks sitting with modest houses but on great lots have been under the radar screen for many, many, years. Not any longer it seems. You think we had peoples attention on the last ref: now we will see a more attentive public in the future. That's my read on the situation. If you have built or bought a house, you are immediately nailed.

I am interested in who's homes are underassessed and what, if any position they hold within the district, village and/or county. It would be an interesting study to compare these folks to the rest of us ordinary "Joes". Have you posted these anywhere? If so, point me in the direction. Like I said, when I compared my own to many around town, I found some underassessed properties that has me still scratch'n my head. The funny part of it all, I was told that those that I found are "sight valued". Guess what? Milton refuses to define their criteria for sight valuing a property. MILTON NEEDS TO BE EXAMINED BY THE STATE!

Dear BBoy: I will share some names in private with you. Hell, it's public information. Many underassessed lots are those where the owner of the lot/house has been a resident for say, 20 years+. Others, are those that have added massive additions and have an exemption for 5 years I believe. Why such a break when new home buyers are hit immediately? What is the reason? To promote commerce? If so, why doesn't it apply to new construction??