School Administrators Seem Wary Of No-Tax-Hike Budget Proposal

A state budget without a state income tax hike is possible, says the Illinois Policy Institute. The conservative think-tank has released its own budget plan, which balances the budget, in part, by cutting off state subsidies for school districts and other local governments. But it’s not a plan that school administrators seem to appreciate.

The Illinois Policy Institute argues that state subsidies “allow local officials to funnel money where it’s most politically expedient --- all without having to answer to local taxpayers”

While the cuts in state subsidies affect local governments generally, the Illinois Policy Institute has one proposal that targets school districts in particular. It proposes to eliminate what it calls “special carve-outs in the state’s education funding formula that grant subsidies to a select few school districts affected by local property tax caps and special economic zones.”

In addition to other cuts, the Institute’s budget plan would end state support for pensions. And school districts and other local governments would have difficulty replacing the lost state revenue with higher local property taxes, because the plan would freeze property tax rates for five years, unless voters approve an increase.

On the other hand, the plan would eliminate unfunded state mandates imposed on local governments, including collective bargaining rules and prevailing wage requirements.

“Local officials must be given greater control over their own budgets”, writes the Policy Institute in its budget proposal, “so they can reduce the burden on local taxpayers and reform how local government is delivered.”

For the superintendent of the Unity School District in southern Champaign County, the five-year freeze on property taxes is the big problem. Andrew Larson says he’s already used to unreliable state funding. He says that only makes local property taxes more crucial than ever for districts like his, and a property tax freeze more of a danger.