After a months-long impasse, Illinois lawmakers approved landmark changes to the way schools are funded statewide. Senate Bill 1947 will change a school funding system that has produced the nation’s worst gap between wealthy and poor school districts. While both Democrats and Republicans pointed to things they did not like during the debate over a compromise worked out by legislative leaders and the governor, state Rep. Will Davis, the Chicago Democrat who sponsored the House bill, said he believed discontent on both sides was a sign of a true compromise.
Here are 6 things you need to know about SB 1947.
1. New funding model The new funding is based on an adapted evidence-based model developed by researchers. That means the funding tries to account for students with different needs. It is based on 27 components like class-size ratios, teacher training and full-day kindergarten. The costs for those elements in each district are totalled to create a targeted funding level.
Unlike the previous funding system, the evidence-based model drives funding to poorer schools and districts first. The Illinois version of the evidence-based system includes a provision that also ensures that, in the first year, no school district gets less money than it did last year.
2. Private school boost A tax credit has been created that incentivizes donations from individuals and businesses for private school scholarships. The credit program is a 5-year pilot program that will prioritize scholarships for students from working-class households, students from failing school districts, and siblings of existing scholarship recipients.
The tax credit will be 75 cents for every dollar donated, for which a federal tax deduction cannot be received. Up to $75 million in credits can be granted annually and the scholarships will be administered by non-for-profits approved by the state’s Department of Revenue.
Indiana has a similar program in which individuals or businesses receive up to 50 cents credit for every dollar donated. Indiana, however, limits the amount of total tax credits awarded to $2.5 million. In both Indiana and the new program in Illinois, participating private schools must administer standardized tests to all enrolled students in the school.
3. CPS property tax hike The Chicago Board of Education will have the authority to increase property taxes by at least $120 million, although Cook County Clerk David Orr has estimated the legislation could help Chicago officials generate closer to $148 million for its teachers’ pension fund. The state’s contribution to Chicago’s teacher pensions will be $221 million, up from just $12.2 million last year. Should the city follow through on the tax hike, it would be in addition to the recent $543 million property tax increase sought to shore up police and firefighter pensions.
4. TIF study The legislation creates a Tax Increment Finance Reform Task Force which will consist of members of the General Assembly appointed by its top four leaders. The task force will be charged with conducting a study of existing TIF laws in the state including:
- examining the pros and cons of TIF districts
- the interaction between TIFs and school funding
- TIF spending
Task force members will report their findings no later than April 1, 2018. Lastly, legislation exempts the task force from having to abide by the Freedom of Information and Open Meeting acts.
5. Property tax cuts Voters can attempt to reduce taxes by 10 percent in school districts where funding is considered to be 110% above “adequacy.” That means voters in school districts with large cash reserves can try to reduce school property taxes. Ten percent of registered voters within a school district will need to sign a petition in order to get the tax reduction question on a ballot in a local election.
6. Fewer requirements School districts will be allowed to reduce gym classes to three days per week. Currently, in grades 11-12, students are able be excused from gym if they participate in a sport. The new plan allows students in grades 7-10 to be excused as well. School districts also will be allowed to use third parties to provide driver’s education to students.