Shelbyville Daily Union

Local News

March 14, 2014

Schools appeal to voters for sales tax support


"Without schools, families will move somewhere else. The schools were paid for by our forefathers and is an investment in our future. We have a choice. We can help them by increasing real estate and property taxes or through the sales tax," Young said.

Shelbyville school board member Mark Snider said his eyes were opened when he became part of the school board. He was able to see the district's budget and the areas in the buildings that need immediate repair.

"I saw the boiler room and just walked out shaking my head. I saw windows in the high school open when it's 10 degrees outside," Snider said. "The long you put things off the more expensive they are going to be."

"The 1 percent tax is the best way to deal with the problems. The money stays right here in Shelby County and helps our kids. It's going to be up to our local school boards deciding what to do with the money - not Springfield," he added.

But what happens if the amount of sales tax revenue drops dramatically?

According to a state rule, if the sales tax passes, an obligation bond gets attached to it. That means, if the school district can't pay its bills with money from the sales tax, it could levy property taxes to make up the difference. Illinois is the only state with this rule.

"Yes, this is the law. But, it's a misconception," Bence said. "If a school district borrows money and uses it to pay off a bond or loan, it's pledging the money to pay off the loan. If they don't, it's illegal. A district can only borrow 75 percent against our anticipated funds and the sales tax could make up the other 25 percent. The sales tax backs up the loans. There are safety nets in place so defaulting is rare.The sales tax revenue would have to drop over several years before we would have to do something. There are alternative revenue bonds that would be used before we could request a property tax levy. The property tax increase is a backup only in case of catastrophe. Districts have been using alternative revenue bond and no one has ever had to ask for property taxes to make up the shortfall."

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