Why some schools get state grants to cut property taxes

This story has been corrected to show estimates for property tax savings in Queen Bee Elementary District 16.

Some suburban homeowners could see their property tax bills temporarily cut by as much as several hundred dollars through a deal in which school boards agree to reduce tax collections in exchange for state grants.

But residents of only five suburban school districts will get the tax break, and officials at some schools left out say the grants aren't going where they're needed the most.

In the suburbs, Marquardt Elementary District 15 in Glendale Heights, Queen Bee Elementary District 16 in Glendale Heights, Round Lake Area Unit District 116, Grayslake High School District 127 and Fox River Grove Elementary District 3 qualified for the grants.

They'll have to forgo a collective $18 million in property taxes over the next two years in exchange for a combined $16.6 million from the state.

They are among 39 school districts across the state eligible to share $53.6 million in exchange for cutting $57.3 million in taxes this year and next, according to the Illinois State Board of Education.

The schools will abate the taxes, a temporary measure, rather than reduce the tax levy, which would be subject to a cap if the school district wanted to raise it again.

While the districts lose a small amount of funding during those two years, the benefit to participating in the program is twofold. One is tax relief to property owners, and the other is that the amount of taxes each district abates each year of the grant funding will be added to the district's total state aid in year three and beyond, ISBE officials who administer the grants said.

There is no requirement that school districts continue to abate property taxes after the second year, though some school officials said that would be the plan. The school boards have until the end of March to file abatement requests with their county clerks in order to qualify for the grants.

"We're not blind to the reality that property taxes are high," said Queen Bee Elementary District 16 Superintendent Joseph Williams. "We can afford the small loss of revenue because we have come in under budget in recent years, so this would be hard to justify taking a pass on."

Williams' district must forgo $1,646,402 in property taxes this year and next to receive two installments of $1,498,324 in annual grants. The move is expected to save the average homeowner about $200 a year, district officials said.

Elsewhere, tax bills could drop as much as several hundred dollars a year, officials said. Commercial property owners would also see tax bill reductions.

Grants are awarded based on a formula using the school district's tax rate and figures from the state's Evidence-Based Funding program that ranks each district's financial health. The formula has been met with scorn from some who complain that wealthier districts are receiving the grants while needier districts are blocked.

Last year, Palatine-Schaumburg High School District 211 and Oak Park & River Forest High School District 200 were among those that received grant funding, according to ISBE. The state adjusted the eligibility formula this year and added a requirement that taxes be abated for two years, but some school districts in better financial shape than others still received grant funding.

John Haffner, executive director of business and operations at West Chicago Elementary District 33, complained districts ranked higher by the state because of the ability to "adequately" fund operations are edging out districts identified by the state as neediest. He argued the state's use of a district's property tax rate in the grant-funding formula isn't a good barometer of a district's need for property tax relief.

"We are at 62% adequacy," Haffner said. "Fox River Grove and Skokie are districts with over 100% (funding) adequacy. They are being rewarded with relief for spending more on salaries, benefits, resources and facilities while District 33 fights to pay market-level salaries, fights high student-to-teacher ratios, can't offer the same resources that 100% adequacy districts offer, and local taxpayers have a higher burden to properly educate their students."

It would take legislative action to change the grant eligibility requirements, state officials said.

In all, 21 elementary districts, 10 unit districts and eight high school districts were awarded the grants. Those school boards are expected to vote on abating the taxes later this month.

"The fact that we applied for this supports there is general interest in it from our board," said Donn Mendoza, superintendent of Round Lake Area Unit District 116. "Part of the general consensus is that tax bills are high, and any time there's an opportunity to provide relief while maintaining our academic programming, we seriously need to consider it."

District 116 would have to abate $3,351,380 this year and next in order to receive $3,310,310 in annual grant funds, a near wash. In other districts, the gap between the tax cut and grant is much wider.

• Marquardt Elementary District 15 must abate $2,400,663 each year to receive $2,081,009 in yearly grants.

• Fox River Grove Elementary District 3 must abate $309,313 each year to receive $209,450 in yearly grants.

• Grayslake High School District 127 must abate $1,332,485 each year to receive $1,252,307 in yearly grants.

This is the second time District 127 has received this type of grant since the program was instituted last year. In 2019, the district received $2.7 million after abating $2.9 million in property taxes.

Last year, 28 districts split $50 million for an average grant award of $1.7 million. This year, while there is more money, there are more districts receiving funds, so the average grant award dropped to $1.3 million.

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School grants pay for tax cutsFive suburban school districts could receive $16.6 million in grants over the next two years if they cut $18 million in property taxes.

District Tax cuts Grant

Round Lake D116 $3,351,380 $3,310,310

Marquardt D15 $2,400,663 $2,081,009

Queen Bee D16 $1,646,402 $1,498,324

Grayslake D127 $1,332,485 $1,252,307

Fox River Grove D3 $309,313 $209,450

Source: Illinois State Board of Education

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