Unlike 2013, passing the tax levy was a fairly uncontroversial process for the Riverside Elementary School District 96 Board of Education in December 2014. 

In December 2013, a narrowly divided school board voted 4 to 3 to adopt a so-called flat levy, but at its Dec. 16, 2014 meeting the school board voted 5 to 1 to increase its levy by 2.2 percent, accepting the recommendation of David Sellers, the district’s interim director of finance and operations.

Mike O’Brien cast the only vote against the increased levy. Rachel Marrello, who had expressed skepticism about the need for a levy increase earlier in December, missed the meeting.

“I would like to see more a flat levy as best we can,” Marrello said at a finance committee meeting on Dec. 2.

O’Brien’s vote against the increased levy preserved his record of voting against every levy increase during his four years on the school board. 

The board approved a total tax levy of $23,543,760. The actual amount of the increase may end up less than 2.2 percent, because Illinois tax cap laws limit property tax levy increases to the rate of inflation (1.5 percent for tax year 2014) plus the value of new property coming on to the tax rolls. 

Sellers told the school board that he was confident that a 2.2 increase would capture all the value of new property coming on to the district’s tax rolls, including the new Costco on Harlem Avenue. Sellers estimated the value of the new property in the district at $3,000,000.

The new development was one reason board president Mary Rose Mangia decided to support a levy increase this year. 

“I’m comfortable with the 2.2 (percent increase),” Mangia said at the Dec. 2 finance committee meeting. “If our fund balance gets too high, I’d rather go to a flat levy in a year when there is not so much new property.”

Randy Brockway, who had voted for a flat levy last year, also supported the levy increase this year, albeit with some reluctance.

“I’m willing to vote yes to the levy, but I’m still quite concerned about our financial spending,” Brockway said before the vote.

It turns out that last year’s so called flat levy actually resulted in a reduction in revenue to the district. 

Because of the limit on the education fund tax rate and a decline in equalized assessed valuation of property, District 96 took in approximately $275,000 less in property tax revenue in 2014 than it did the year before, Sellers said. That was a result that the supporters of the flat levy did not anticipate.

“With all the good intentions that everyone had last year, that didn’t work out,” said Juliet Boyd, who was appointed to the school board in September.

Adopting a flat tax levy last year permanently reduced the district’s revenue in future years, because levy increases are calculated against the previous year’s levy. Once an amount is not added to the district’s tax base it cannot be made up in future years. 

The lost revenue compounds in future years, because the tax base is permanently less than what it could have been.

Sellers said if the district wanted to give some relief to taxpayers in the future, a better approach than a flat levy would be to levy the maximum amount allowed by law and then rebate a portion of the taxes collected back to taxpayers. That approach would not reduce the district’s tax base in future years.

Given the financial uncertainties facing the district, the school board decided not to do rebate taxes. The level of state funding to the district is uncertain and subject to change as the state legislature considers changes to the school funding formula. 

Board members are also worried that the state may stop paying into the teacher pension fund and push that large expense onto local school districts.

A new contract with teachers also needs to be negotiated, since the current contract expires in 2015, adding further uncertainty. 

Boyd noted that the district could also be facing significant technology costs in the near future if it changes the devices that students use in the current one-to-one laptop program. 

She said rebating taxes could hurt the district’s bond rating and pointed out that property in the district is undergoing reassessment by the Cook County. 

Boyd said it was not the time to take “a radical step.” Rather, the rebatement option should be kept in mind as an option in the future.

Other board members agreed.

“I think it is a great option to consider at a later date,” said board member Rich Regan.