The Governor signed the budget today (yay!) and we’re all praising the legislature for adding another $350 million towards the evidence-based funding formula enacted last year.
Let’s break down that $350 million a bit more.
$300 million of that figure will be equitably distributed first to the school districts that are the most under-funded (i.e., furthest away from adequacy) and just like last year, no district will lose money.
The remaining $50 million will be “swapped” for property tax relief, with those funds rebated to homeowners in the form of grants.
If Springfield had allocated more than $350 million, the remaining amounts would be handled in the same manner as the $300 million.
This is the first time in history that these property tax relief grants have been funded. It’s uncharted territory, but here’s how it works:
- School districts with the highest property tax rates can apply for a grant.
- By August 1 of each year, the Illinois State Board of Education (ISBE) will estimate what tax rate school districts must have in order to be eligible. It all depends on how much money is put into the fund, since more funding means the state can afford more grants.
- School districts can apply until October 1 for grants worth up to 1% of the “equalized assessed value” of property in the district.
- By December 1, ISBE will publish a list of districts that qualify, based on the total number of applicants and the threshold tax rate for relief.
- Qualifying districts will receive their grant payments by January 15.
- School districts, in turn, rebate the amount of the grant to their property taxpayers.
One of the facts that became abundantly clear during the examination and re-write of the formula is that school funding isn’t just inequitable for students. It’s also inequitable for property taxpayers. Those who live in the poorest areas pay the highest property tax rates. For example, at the lower wealth end of the spectrum, one elementary district in the south suburbs has a tax rate of 9.8%, but it is still only 59% funded. At the other side, one of the wealthier elementary districts – which is funded at 288% – has a rate of just 1.5%.
So in August, you might take a peek at the ISBE website to see what tax rates might qualify. If your school district has a higher rate, ping your school board about going for a grant. It’s a new program and it’ll take some work to get it going, but what a great opportunity to reduce the reliance on property taxes without costing our schools those needed resources!