District 308 Mulling Future Kendall Sales Tax
Proposed sales tax would potentially lessen the burden on property owners.
The Oswego 308 School District is considering the addition of a sales tax referendum for the future that may have some homeowners breathing a little sigh of relief.
The proposed sales tax would help to spread out the tax burden and help the school district to pay back outstanding bonds more quickly, said Board member Mike Scaramuzzi, who heads the Finance and Advisory committee with fellow board member BrentLightfoot.
The Finance Advisory committee previously discussed how the district might go about refinancing bond debt to help reduce costs for the district and homeowners, but found few solutions.
“There is additional cost associated with any restructuring,” said Scaramuzzi. “There may have been some short-term tax relief, but longer taxpayer pain.”
From that conversation arose the idea of an additional sales tax on goods purchased within the Oswego 308 school district boundaries, which Scaramuzzi said would be about one cent.
Superintendent Matthew Wendt said the example the school is considering is a one cent tax on every dollar of approved sales, but it could be a quarter or even half of a cent.
As Scaramuzzi said, "The less they [the homeowner] spend, the less they're taxed."
Wendt said he knew of at least two counties in southern Illinois that have been successful with a sales tax. His previous school district in Ankeny, Iowa also had experience with a sales tax.
In an article on the Ankeny School Site from 2010, the Ankeny school district used their one-cent state-wide sales tax to build the district's ninth elementary school.
The district also planned to use the sales tax generated revenue to complete the renovation of one of the other elementary schools, install artificial turf at both high schools to reduce future maintenance costs among other projects.
Although it is considered a school district tax, Wendt said the tax would be in affect throughout Kendall County.
"It is my understanding that school district boards of education partner and collaborate to determine if the sales tax will be brought before the voters throughout a county," said Wendt. "However, if a school district enrolls more than 50 percent of the K-12 students within a county, that school district's board of education has the single authority to determine if a referendum is brought before the voters of a county."
In Kendall County, District 308 enrolls more than 50 percent of the K-12 students, so the Board of Education would have the authority to bring forward a sales tax referendum to be voted upon by county residents.
"If the referendum is approved, all school school districts within the county would financially benefit from sales tax revenue," said Wendt.
“Conversation is the first step,” said Wendt. He said that the topic could be approached possibly later in the spring or summer if the board wanted to move forward.
The Oswego 308 school district would plan to have the sales tax apply only to certain purchases.
“We’re looking at a sales tax… specifically targeted at debt reduction, bond payoff, future brick and mortar,”said board member Brent Lightfoot. “We’re not looking at a sales tax to pay general operating funds. It’s money that would be well spent.”
Wendt added that Ankeny used the sales tax revenue only on paying down current bond debt that would help to reduce taxes on homeowners and businesses and new construction and remodeling.
Some aspects of the tax would still need to be ironed out, like which types of sales would be taxed. Wendt said he knew, for example, that groceries, prescription drugs and farm equipment/supplies have been made exempt from current approved sales tax referendums in Illinois.
"For School District 308, it is imperative we seek short and long-term plans to reduce property taxes, yet fulfill the obligation of providing a quality education within needed school district facilities," said Wendt. "However, it is important that we initially collaborate with school district superintendents and boards of education throughout Kendall County prior to advancing this opportunity to voters."
For the sales tax to be approved, the school board would have to send the idea to referendum. The earliest election that could include the sales tax on the ballot would be the March 2014.