Palos Park D118 voters face tax question
Referendum planned for March election focuses on levy for school funding
Palos Elementary District 118 voters face a referendum on the March ballot asking to transfer future property tax money to the district’s operating fund, but officials say the move won’t increase property taxes.
Voters will be asked to allow the district to transfer the levy of $4.35 million, which has been collected annually for the district’s debt service fund, to its operating fund in coming years to address budget shortfalls, according to a district news release.
Superintendent Anthony Scarsella said voting yes to the referendum won’t increase or decrease property taxes because the proposed increase in the operating tax rate will be offset by a decrease in the debt service tax rate.
“School districts don’t often get opportunities like this to address financial challenges without increasing or decreasing the tax burden on local homeowners,” board President Pam Paris said in the release.
If approved, $2 million will go toward budget deficits and avoid cuts to existing programs and services; $2 million will go toward maintaining school facilities and end reliance on short-term borrowing; and $350,000 will pay for the state mandated, free fullday kindergarten starting in the 2024-25 school year, according to the release.
Scarsella said Monday the district issues debt bonds every five years or so to cover the cost of capital projects. The $2 million portion of the referendum that would go toward school facility maintenance would be reoccurring and allow the district to become less reliant on issuing bonds to pay off debt, he said.
“That’s really important to us right now because when we issued debt a couple years ago the interest rates were a lot lower and they are a lot higher now,” Scarsella said. “We’re hearing that those rates may be coming down, but that’s not a certainty. If we have to continue relying on debt we’re going to be borrowing at higher rates, which is going to cost our taxpayers more.”
The property taxes school districts collect are divided into two rates: a debt service tax rate and an operating tax rate, Scarsella said. The district has issued debt bonds to pay for maintenance, he said, and would like to pivot to using its operational fund, which wouldn’t require using the bond market.