Illinois County School Facility Tax (CSFT) - Prairie Central CUSD

Illinois County School
Facility Tax (CSFT)
(PA 97-0542)
Proposed for Livingston County
April 9, 2013

The Issue
On April 9, Livingston County
voters can approve a 1% sales tax to
fund school facility costs
The tax would be added to the current
sales tax (6.25% + 1% = 7.25%) on
selected retail items county-wide
If a simple majority of County voters
approve, the tax will apply to all
Livingston County public schools

97-0542: Definition & Origins
The tax is intended for school facility costs
Enacted in 2007
Amended in 2011 (to exclude county
boards from the decision to place the
question on the ballot)
Can be approved to 1% (1/4%
increments)
In use now in 12 counties in Illinois
In use now in every county in the
state of Iowa

Sales Tax Rate Comparison
• Decatur – 9.00%
• Streator – 7.50%
• Springfield – 8.00%-9.00%
• Peoria – 8.25%-9.25%
• Fairbury-Pontiac – 6.25%
• Champaign – 8.75%
• Bloomington-Normal – 7.75%
• Marion – 8.25%
• Lawrenceville – 7.25%
• Galena – 8.25%
• Chicago – 9.50%

Sales Tax Base
Includes retail items, EXCEPT
Cars, trucks, ATVs
Boats & RVs
Mobile homes
Unprepared food
Drugs (including over-the-counter & vitamins)
Farm equipment & parts
Farm inputs (chemicals, equipment, feed, seed,
energy)
“If it is not currently taxed, it will not be taxed”

Use of Sales Tax Revenues
Eligible
New facilities
Additions & renovations
Land acquisition
Ongoing maintenance
Architectural planning
Durable equipment (nonmoveable
items)
Fire prevention/life safety
Disabled access & security
Energy efficiency
Parking lots
Demolition
Roof repairs
Ineligible
Direct instructional costs
Text books
Buses
Detached furniture & fixtures
Computers
Moveable equipment
Operating costs
Salaries & overhead

Estimated Sales Tax
Generated in Livingston
County for Prairie
Central?
$777,721
. . . The money follows the student

School Use of Sales Taxes
Pay-as-you-go capital projects
Sales tax spent or saved
New bonds for current capital needs
Pay off with sales tax
Retirement of existing bonds
Abate
Refund
Any combination of the above
Can have the effect of delaying a
property tax or avoiding a tax to
retire bonds

Use of Sales Tax Revenues
Computers?
No
Infrastructure/wireless?
Yes
Interactive White
Board?
Yes

Prairie Central’s Intentions
with CSFT
Provide $2.3 Million in health-life-safety projects, rather than
issue bonds/tax property
Upgrade and add to surveillance, security equipment (cameras,
secure doors in buildings; bus cams)
Enhance technology
Infrastructure
Wireless installation (for 1:1 initiative)
CIRBN preparation (for expanded band-width)
Permanent technology equipment
Interactive white boards
Cabling
Update antiquated fire alarm systems
Update antiquated phone systems
Convert to geothermal systems (distant future consideration)
Complete pay-as-you-go facilities projects

Advantages vs. Disadvantages of CSFT
Advantages
25-30% of revenues generated by
passers-through; and a significant
portion by non-Prairie Central
consumers
Sales tax is paid by choice
Not all retail items fall under the tax
Livingston County has a relatively low
sales tax rate
Can be used to abate or replace building
or health-life-safety bonds
New sales tax can delay an operating
fund property tax referendum
The Illinois General Assembly cannot
intervene in distribution
Although generated money is limited to
facilities, creative budgeting can
displace some operating expenses
Disadvantages
CSFT is a tax (the “T” word)
Use of money is limited to facilities
CSFT is not a panacea
A sales tax can affect the behavior of
businesses and consumers, which can
affect collection

Financial Crisis in Illinois and
School Funding
The mission of schools is expanding
School systems have traditionally relied on Illinois for 40-45% of
revenues
Illinois is $9 Billion behind in paying bills
School funding has been dramatically reduced and surviving
payments have been delayed (6-9 months)
Four major grant programs have been cancelled outright
The Early Childhood Education grant has been significantly
reduced
Transportation & special education reimbursement programs
have been significantly reduced
Prairie Central has lost $1 Million in general state aid over 2
years ($1.5 Million prospectively in 3 years)
Loss of enrollment
Freeze in formula foundation level
Pro-ration

The Ballot Question
Yes
No
“Shall a retailer’s occupation tax and a
service occupation tax (commonly referred
to as a ‘Sales Tax’) be imposed in
Livingston County at a rate of 1% to be
used exclusively for school facility
purposes?”
Yes = I Favor the 1% Sales Tax
No = I Oppose the 1% Sales Tax

The End
Prairie Central