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Important School Board Meeting Monday on Tax Levy

With a tentative agreement established between the School Board and Geneva Education Association, the Monday night agenda turns to an important topic: the tax levy.

During teacher contract negotiations, hundreds of people packed School Board meetings to state their point of view, show solidarity and participate in the process of local government.

Wouldn't it be wonderful if as many of us paid as much attention to all aspects of local government?

The Geneva School District 304 Board of Education will be addressing the 2012 tax levy during its . The meeting is open to the public.

Yes, the topic might sound dry compared to the emotion of a contract dispute, but when it comes to impacting students, educators and taxpayers, the levy decision is where the rubber meets the road.

It's popular these days to label an issue as a "crisis," and it's a word no one wants to apply to School District 304's financial situation. But it's not an exaggeration to say that the budget challenges facing Community School District 304—and the community as a whole—are signficant.

In simple terms, the problem is that Geneva School District 304's tax base is shrinking. New construction has dwindled to a fraction of what it was even 10 years ago, and property values of existing homes are going down.

Between 2010 and 2011 alone, the equalized assessed value of property in School District 304 dropped 5.73 percent.

So if the district spends as much as it did the previous year—without raising the levy even a dime—tax rates will go up and property tax bills will go up, probably sharply, and probably for the next several years.

There's a very good graphic and explanation of the process in a document titled "Tax Levy 101" on the School District's website.

A big part of the challenge is the district's $300 million (principal and interest) debt brought on in large part by school building bond referendums that paid for the construction of new schools and school building additions.

New growth was supposed to keep property taxes from climbing too steeply—but that tax-base expansion not only didn't happen, it went the other direction. 

About 84 percent of the Geneva School District's operating budget comes from the tax levy. And the funding sources for the remaining 16 percent—government grants and state aid, for example—are dwindling or at risk, in part because of the state's own fiscal crisis.

At the Oct. 22 School Board meeting, Elizabeth Hennessy of William Blair & Associates offered four scenarios—along with some variations—in which School District 304 might use fund surpluses to pay down the debt. You can read the details in the document Abatement and Refunding Options on the district's website.

Some scenarios include raising the tax levy to the maximum allowed under tax-cap legislation.

There will be no public hearing for the 2012 levy.

The upcoming tax levy decision doesn't determine where money is spent but it does address how much is collected, and for those who care about the future of Geneva schools, teacher salaries and the quality of education, there are few topics more important.

Bob McQuillan November 12, 2012 at 08:13 PM
Rick Excellent article and a great explanation of how the tax levy works. The board has done a great job providing the information to us. Now they need to hear our thoughts on what should be done. Will there be 300 or 30 people at the meeting? This meeting will set the path for the next 5 years.
Rich Hayhurst November 13, 2012 at 12:03 AM
Taxation in plain English + a few points made. The 'levy' is the School District's bill to local taxpayers. 70% of your property taxes are to pay the bill issued by Geneva school district 304. The bill is determined by the school board. The school board is elected in poor turnout Spring elections, Voting turnout is particularly high among Union teachers, administration, and support staff. Due to the nature of these elections, Unions easily embed 'Union friendly' and 'taxpayer unfriendly' board members. Geneva schools enrollment has been declining every year since 2009, but the Union friendly school board has continually billed the taxpayers the maximum allowable. The result = a very large (multi-million dollar) surplus of excess cash sitting in the school district's bank account. Your 2007 loan for new schools costs about 14 million this year, and will soon increase to about 25 million a year. This loan will be amortized across all of the taxpayers in school district 304. The payment increase will cause Geneva taxes to increase, regardless of what the school board does with their annual tax billing. To rectify prior years overtaxation, Geneva residents should encourage the school board to tighten their belts and vote for a zero percent tax increase going forward.
G.Ryan November 13, 2012 at 03:33 AM
Well, Rich the Board members are all talking about raising the tax levy to 1.5 %. The unfortunate issue is they just don't get it. It is spend,spend,spend,tax,tax,tax never cut,cut and cut. If they did not have us tax peasants they would be forced to cut. It will take filing bankrupty from all of us taxpayers till they get it. And the way it is headed this will eventually occur just a matter of time.
Derek November 13, 2012 at 10:28 PM
We have the same problem on our board as our federal government. No business backgrounds. I would be curious to know exactly how many of the board members have run a multi-million dollar company before. If they had, they would understand that in order to stay alive for long, you can't spend more than you bring in. Again, just like our wonderful Fed's, they just keep on taxing the residents to pay for all the spending. Too bad we can't just plan on never repaying the debt like our Federal government seems to be doing.

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