COAL CITY — Representatives from a brokerage firm asked area school boards Wednesday night to consider pushing for a 1 percent sales tax increase as a new method of funding.
In an informational meeting at the Coal City Early Childhood Center, Jim Burgett and Kevin Heid of the brokerage firm Stifel, Nicolaus & Co., Inc., said the move would lower property taxes, while generating revenue for schools.
“Revenue is drying up,” Burgett said. “This is the only new game in town, and it’s a game that makes sense.”
The tax would be applied to items currently taxed and could be spent on facility-related expenditures, such as additions, renovations and energy-efficiency projects.
Enacting the tax, the representatives said, would shift some of the responsibility for funding away from property taxes to this sales tax.
“It’s essentially tax reform,” Burgett said.
For it to happen, school boards representing more than 50 percent of the resident student enrollment in the county would need to pass a resolution, which will get a measure on the ballot in the next election. It would then require a simple majority of votes, and could be enacted in quarter increments up to one percent.
According to Burgett, every county in the state of Iowa and 18 counties in Illinois have already enacted the tax.
To get the measure on the ballot for the next election, in March of 2014, the school districts would have to pass a resolution by Dec. 30 of this year. Heid said that means the districts would have to begin discussing the measure — and educating constituents on the issue — quickly.
“We think you would need to work ahead of that date,” Heid said.
Members of local school boards seemed intrigued by the concept and said they would begin discussing it at their meetings.
Teri Shaw, superintendent of Morris Elementary Dist. 54, said members of her board had heard a presentation on the topic and that the previous finance committee had liked the idea.
“This is a fact-finding mission at this point,” Shaw said. “But anytime we can have some type of property tax relief, that’s something to take a look at.”
Saying the board will have to consider it further, Shaw said the district could see significant benefits from the measure because Dist. 54 contains a large percentage of the county’s student population.
The money generated by the sales tax would be distributed to districts based on their share of the county’s student enrollment.
Dist. 54 contains 12.5 percent, Saratoga Elementary Dist. 60C has 8.4 percent and Nettle Creek Community Consolidated School Dist. 24C has .9 percent, according to approximate figures provided by Stifel.
Morris Community High School Dist. 101 contains 9.7 percent of the county’s enrolled students.
Kathleen Cheshareck, president of the Dist. 60C school board, said the board would begin to talk about the matter.
“It sounds like a good idea to consider,” Cheshareck said. “I think our board will end up discussing this.”
Dist. 101 Superintendent Pat Halloran echoed Cheshareck, saying the presentation included “great information.”
“A lot more research needs to be done,” Halloran said. “But this is definitely important for us to consider.”
An introduction to the sales tax can be viewed online at: www.youtube.com/watch?v=Mv9LmF6baMM