One way U-46 can raise funds: Move HQ

Nearly $50 million in the hole, Elgin Area School District U-46 is exploring moving headquarters to a different county to capitalize on millions in lost state aid.

That idea, part of the district's aggressive quest for a funding fix, was discussed publicly for the first time by officials and legislators at the Citizens Advisory Council's legislative town hall meeting at Elgin High School Friday evening.

Of the eight local lawmakers invited to the event, state Sen. Michael Noland and state Reps. Keith Farnham, Randy Ramey and Paul Froehlich attended. There were so many attendees the meeting was moved from the school's library to the auditorium.

The 41,000-student district has schools in Kane, DuPage, and Cook counties.

For years, the majority of the district's taxable property was in Kane County. But in 2004, district lawyer Pat Broncato said, Cook County became dominant.

But the district is still considered a Kane County district by the State Board of Education, which officials believe results in inaccurate amounts of state aid.

The more local tax revenue available to a school district, the less state funding it receives.

The "limiting rate" - the maximum property tax rate allowed under the Property Tax Extension Limitation Law - determines the amount of local funding. If it is overestimated, it appears the district will receive more in local property taxes and the state accordingly delivers less funding.

In U-46's case, Kane County, as the "home county," estimates DuPage and Cook counties' rates if they have not yet been determined.

If U-46 could get reclassified as a Cook County district, either by moving its offices or a simple state board of education re-designation, officials believe it could result in more accurate payments.

Last year, spokesman Tony Sanders said, district officials calculated they should have netted $69.7 million in general state aid.

But with Kane County working as the dominant county and estimating the other rates, the State Board of Education calculated U-46 would get just $58.3 million - roughly $11 million less.

The state has given U-46 a one-time $7.1 million "administrative fix" this year to help with the funding shortfall.

But the district is still looking for a permanent change, whether through the state board redetermining U-46 as a Cook County district or through a change in the law.

State Superintendent Christopher Koch and U-46 Superintendent Jose Torres had a phone conversation about the issue yesterday.

Koch told district officials that he intends to speak with the state board about the issue next week, spokesman Tony Sanders said.

Noland has also introduced legislation that would force the state board to readjust the limiting rate once the actual rate becomes available, and adjust general state aid payments.

The legislation is similar to a bill pushed by nearby Huntley Unit District 158 that supporters say would have fixed the issue for multi-county districts. U-46 declined to support it last spring, saying it would not help its situation because it was written under a different section of the state's school code.

With a $48.6 million deficit, now is the time when every penny counts for U-46.

Attendees at the forum also spent time listening and asking questions about a growing number of unfunded education mandates the district is being forced to implement.

These including adding Mexican-American history and teen dating violence and testicular cancer education into curriculums and adopting new health and safety policies.

At the same time, the state is $12.4 million behind in payments to the district, and U-46 is trying to determine how to cut $40 million out of next year's budget.

"This is crunchtime," Sanders said.