Senate Bill 316 Sought Property Tax Freeze
07/15/2015
By: Brittany Flaherty Theis
Senate Bill 316 sought to amend the Illinois Property Tax Code, the Illinois Pension Code, and the Illinois School Code. A second amendment to Senate Bill 316 (“SB 316 Am. 2”) was filed this morning and was discussed by the Senate Executive Committee thereafter. The Executive Committee recommended SB 316 Am. 2 be adopted. SB 316 failed to receive sufficient votes and was defeated the same day it was filed. However, due to prevailing discussions surrounding the State of Illinois’ budget concerns, one might expect to see similar legislation proposed in the near future.
Property Tax Code
SB 316 Am. 2 amended the extension limitation for the 2016 through 2018 levy years and expanded the taxing districts subject to the extension limitation to include home rule units. For levy years 2016 and 2017, the extension limitation for all (including home rule) taxing districts outside of Cook County would have been set at 0% or the rate previously set by the voters, if applicable. This essentially froze property taxes for levy years 2016 and 2017 at 2015 levels. For those taxing districts, the extension limitation returned to 5%, the increase in the Consumer Price Index, or the rate previously set by the voters, if applicable, for levy year 2018 for those taxing districts that were subject to the extension limitation in 2015. For those not previously subjected to the extension limitation, the limitations would be lifted for levy year 2018 and beyond.
For levy year 2016, the extension limitation for taxing districts inside of Cook County is the lesser of 5%, the Consumer Price Index, or the rate set by the voters, if applicable. For the 2017 and 2018 levy years, the extension limitation would have been set at 0% or the rate previously set by the voters, if applicable, freezing the property taxes for those districts in 2017 and 2018.
SB 316 Am. 2 provided that no referenda under §§ 18-213 or 18-214 may be held with respect to levy years 2016 and 2017.
The definition of “aggregate extension” would have been amended to add special purpose extensions “made for public safety purposes” to the list of excluded special purpose extensions. Therefore, special purposes extensions made for public safety purposes would only be subject to an extension limitation of the lessor of 5%, the increase in the Consumer Price Index, or the rate set by the voters.
Pension Code
Teachers’ Retirement System of the State of Illinois (“TRS”)
SB 316 Am. 2 required the State of Illinois (“State”) to contribute its normal cost and the portion of the unfunded accrued liability assigned to that year to TRS. It also provided that the board of trustees shall bring a mandamus action to seek payment of those amounts if the State fails to pay.
Public School Teachers’ Pension and Retirement Fund of Chicago (“Fund”)
In addition to any other required contribution, the State was to contribute $197,000,000 to the Fund for State fiscal year 2016 and additional amounts related to employer normal costs and amounts allowed by law to defray health-insurance costs. SB 316 Am. 2 appropriated funds from the Common School Fund to the Public School Teachers’ Pension and Retirement Fund of Chicago to the extent other amounts appropriated fall short of the State vouchers. Additionally, the Board of Education was to contribute $207,000,000 for fiscal year 2016, $211,000,000 for fiscal year 2017, and thereafter, an amount sufficient to bring the total Fund assets up to 90% of the total actuarial liabilities of the Fund by the end of 2063.
School Code
SB 316 Am. 2 amended statutory provisions regarding block grants. In particular, the School Code would have been amended to provide that in each fiscal year after May 31, 2017, 37% of the funds for an Early Childhood Education Block Grant was to be awarded to a school district having a population exceeding 500,000 inhabitants. It also repealed Block Grant Funding for districts with over 500,000 inhabitants (105 ILCS 5/1D-5) as of June 1, 2017.
For the 2015-2016 school year, the Illinois State Board of Education was to provide supplemental grants to limit districts losses due to the differences in general state aid (“GSA”) amounts calculated using the GSA formula and the amount appropriated by the State for GSA, subject to appropriation by the State. For the 2016-2017 school year, and each school year thereafter, no entity receiving GSA could receive a smaller percentage of its GSA claim than it received in the 2015-2016 school year.
Additionally, SB 316 Am. 2 repealed the GSA section of the School Code as of June 1, 2017. It creates the General State Aid Committee, which was to meet and propose a revised school funding formula for Illinois schools. The proposed formula would have been due by December 31, 2016.
Attorneys from Whitt Law’s Springfield and Aurora offices will continute to monitor legislation impacting school districts throughout Illinois. Please contact Whitt Law Partner Stuart Whitt should you have any questions or concerns.
This blog/website is made available for educational purposes only. It is not intended to provide specific legal advice to your individual circumstances or legal questions. You acknowledge that your reading of this blog site does not establish an attorney-client relationship between you and the blog/website host or the law firm, or any of the attorneys with whom the host is affiliated. This blog/website should not be used as a substitute for seeking competent legal advice from a licensed professional attorney in your state. Readers of this information should not act upon any information contained on this website without seeking professional counsel.
Recent Comments