'The State has determined that $1,260 per student in average daily attendance (ADA) is the amount necessary for school districts to educate a child'
earlier.)
Obviously, computing State aid by such complex formulas is confusing. It does appear to be among the most complicated of Slate aid formulas in the nation.
House Bill 1484 was introduced in the 1973 legislative session to simplify the procedures, as well as to eliminate the penalty for dual districts. As the bill worked its way through the legislature, various changes and amendments were added on. The net result of these changes was that all of the previous methods of calculating State aid were retained and the "resource equalizer" was added as an option. A district must therefore calculate its State aid by all methods to determine the maximum amount possible.
The basic State aid equation has
three components: assessed valuation,
tax rate, and revenue. The Strayer-Haig
approach guarantees a revenue amount;
the "resource equalizer" guarantees the
assessed valuation; and the "power
equalizer" (not used in Illinois)
guarantees a given return on the tax
rate applied. All are designed to provide
slate money to supplement locally
raised educational funds. 'Resource equalizer' option
The "resource equalizer" works like
this: The State has determined that
$1,260 per student is average daily
attendance (ADA) is the amount
necessary for school districts to educate
a child. Since some school districts have
less assessed valuation than others, it is
difficult for them to come up with this
amount without levying exorbitant lax
rates. The State has said (H.B. 1484) it
will make up the difference between the
$1,260 and the amount produced per
pupil by the local school district's
operating taxes,* provided that the
school districts levy their operating
taxes at or above a specified rate (3.00 per
cent for unit districts, 1.05 per cent for
high school districts, and 1.95 per cent
lor elementary districts). H.B. 1484 also
requires tax rates above these maximums be lowered each year by 25 per
cent of the amount by which they
exceed the maximum. In effect, this
system places a higher valuation on the
taxable property, or resources, of
poorer school districts (thus the name
"resource equalizer") in order to
guarantee $1,260 per ADA.
The "resource equalizer" guarantees a property valuation per weighted student of $42,000 for unit districts, $64,615 for elementary districts and $120,000 for high school districts.
Table II shows the key values for comparing how districts of different types fare under the plan.
Because of the differential in threshold tax rates and guaranteed valuations per student for the three categories of districts as shown in Table II, only high school districts can easily qualify for State aid under the resource equalizer formula; but only 15 of 446 unit districts are eligible.
It is difficult for unit districts to raise their operating tax rates to the threshold level required for the resource equalizer State aid because referenda are required to raise their operating tax rates above 2.075 per cent which is .925 per cent below the required rate. But, for high school districts, no referenda is needed since their maximum operating tax rate by statute is 1.27 per cent, which automatically would qualify them for resource equalizer State aid.
The authors of H.B. 1484 clearly
intended to design a plan by which the
Stale would contribute more than half.
of all operating revenue to school
districts. If districts whose assessed
valuation is more than half of the guaranteed
valuation raise their rates, they generate
more local revenue than Sate support,
while the reverse holds true for districts
below that point. It is too early to tell
what voters are going to do in response
to the incentives, but a quick glance at
districts' operating referenda for the
past two years may give some indication. Taxpayer's perspective
From Table II, it appears that the
taxpayer gets an even break whether he
pays taxes to a unit district or whether
he pays taxes separately to a high
school and an elementary district. In
both cases he would pay the same: 3.00
percent. On the other hand, the
taxpayer who pays taxes to both a high
school and an elementary district would
have no chance to approve or
disapprove an increase to the combined 3.00
per cent tax rate — a tax rate which
would need referendum approval in a
unit district.
Another comparison should be made from the perspective of the local school
*0perating rates for calculating Slate aid by the "resource equalizer" method includes all tax rates except those for bonds and interest, rent, special education construction, vocational education construction, summer school, capital improvement and transportation.
Table II
Key Values for Resource Equalizer
Type of District
Elementary |
Guaranteed valuation/student
$ 64,615 |
Threshold tax rate
X 1.95% |
Guaranteed amount per student
= $1,260 |
Districts eligible for resource equalizer aid*
76 of 507 |
* Figures from 1972 showing those at or above maximum tax.
Illinois Issues/February 1975/49