The Vandalia Board of Education is looking at approving a new tax levy that will either include no increase in the tax rate, and maybe even a decrease.
In continuing its regular November meeting last Wednesday, the board discussed the tax levy, which will be on the agenda for next Tuesday’s regular December meeting.
Vandalia Superintendent of Schools Dr. Jennifer Garrison said, “Hopefully, with an increase in the EAV (equalized assessed valuation), we will actually have a tax-rate decrease.”
Garrison noted that the new tax levy will retain the 25-cent reduction per $100 of EAV that was put into affect last year.
The board decided to include that reduction last year as a good faith effort when it campaigned for a county-wide 1-percent sales tax for schools.
The Vandalia district plans to use the money generated from that sales tax to offset property taxes and help fund needed building maintenance and needed improvements, and possibly addressing its bond debt.
During a brief discussion on the levy, board Vice President Joe Schaal said he favors keeping the levy with no increases, and no decreases.
Schaal said that looking at the district’s long-range facilities plan, “Theoretically, we have enough projects (to pay for) for five years, things that just need fixed.”
Board member Ryan Lewis said he feels the district should see how much revenue it will receive from the sales tax in a year before making any adjustments to the levy.
“Next year, we can adjust, based on the cash flow,” Lewis said.
Also at the meeting, board members discussed the proposed intergovernmental agreement with the city of Vandalia regarding the use of the Tax Increment Financing program in the city.
Garrison said that the agreement “has been a work in progress since April.”
The approval of an intergovernmental agreement, she said, is required for the board to approve the TIF Best Practices document.
“This is a package deal,” Garrison said. While the city has approved the Best Practices document, the school district is waiting for the city to approve the intergovernmental agreement, she said.
Garrison said that the district is supportive of an extension for TIF District No. 1 “once they approve our intergovernmental agreement.”
She said that even before the school district learned that the city was going to be requesting an extension of the term for TIF District No. 1, “there was still a conversation around TIF and liability and reliability of how TIF funds were being spent.
“I just listened to people as we were having these conversations, those with the mayor and the city council, and how this was drafted, I took my notes of actively listening and drafted them into the Best Practices Agreement that the city council has now approved.”
She said that state Rep. Blaine Wilhour got involved and has supported the two documents.
The current term of that district is set to expire in 2022 and the city is hoping for a 23-year extension.
Garrison said, “With the intergovernmental agreement, I’ve had the question (asked) often why does the school district care.
She said that hearing the audit report, “We still have the $13 million in bond debt. It is our long-term debt that is causing us still to struggle financially.
“TIF money is tax money, we are a taxing body, we are the largest tax body in TIF 1. So, of the revenue generated in TIF 1, we are about 50 percent of that revenue generated,” she said.
“We’re not asking for all of the money that we generate, but we are asking for 50 percent of it back, to go to our capital projects, to go to bond abatement,” Garrison said.
Wilhour is focusing on property tax relief, she said. “We know that we need property tax relief directly to our bond indebtedness, so this would equal about $150,000 that would flow directly, if this is approved first by the city council and then also the (Illinois) General Assembly, to bond abatement.
“Which then allows the 1-percent sales tax to be used for bond abatement and capital projects,” Garrison said.
“This is just another way for us to look at our fiscal house and make sure that our fiscal house is sound, but also have the Best Practices going with that overall,” she said, adding that it wasn’t just the school board, but others in the community as well talking about the use of TIF funds.
Board member Kevin Satterthwaite spoke at length about the reasons for the intergovernmental agreement.
Starting out by praising Garrison for “personally giving us all the process we went through,” Satterthwaite said, “Personally speaking, I was among some of the people questioning the TIF funds before I was ever elected to the board.
“Then, I switched hats as I was elected to the board and became more aware of the actual dollar amounts,” he said.
“Like you (Garrison) said, they (TIF dollars) are all from the individual taxpayers, but they’re going to have a direct affect on our financials,” Satterthwaite said.
He said that the district is contributing something like $370,000 dollars to the TIF 1 fund. “That’s taxpayers’ dollars – that’s not the school board’s, that’s not the districts, that’s taxpayers’ dollars.
“So, we basically lose that as a school board out of our financials unless there is a return on investment somehow or other than benefits the district, whether that be tax revenue streams or EAV,” Satterthwaite said.
“Speaking for the school board, I believe we have put our best foot forward, trying to look out for the school district’s welfare while at the same time not just throwing up our hands and telling the city we’re not going to favor an extension.
“We tried to do both. We’re trying to look out for our welfare and our financial responsibilities as a school board, while at the same time, since we are the largest taxing body, still providing the city some type of opportunity,” he said.
“I think it’s important to know that it would have been very easy for the school board to potentially say (that) we’re not extending TIF, and that would have upset a lot of people,” he said.
So, Satterthwaite said, the school board is trying to “look out for ourselves” while also supporting economic development.
He said that it’s important to know that either document is any good without support from the Illinois General Assembly for the extension of TIF i.
And, he said, initially, this area’s legislators we’re not on board with the plan. He praised Garrison for meeting multiple times with state Rep. Blaine Wilhour.
Wilhour became involved and gave some ideas on TIF funds being used to reduce the burden of taxpayers, giving his support for an extension as the process evolved.
Prior to the discussions on the levy and intergovernmental agreement, the board received the audit report from Robin Yockey of the Shelbyville CPA firm of Mose Yockey Brown & Kull LLC.
Yockey presented a favorable report, saying that the district received a rating of financial recognition with a score of 3.7 out of a possible 4.0, and that keeping it from raising its score is its long-term debt.