Published Online: February 5, 1997

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Odds Seen Better for Funding Reform in Ill.

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After years of rancorous partisan debate, state leaders in Illinois say that long-awaited school funding reform may be for real this year.

Many signs point toward a new resolve by lawmakers to deal with some of the nation's biggest disparities between rich and poor school districts, but the array of ideas already on the table suggests that the battle has just begun.

"Let us act," Republican Gov. Jim Edgar implored lawmakers in his State of the State Address late last month. "Let's reform education funding this spring ... before the next election."

Only a few weeks into the yearlong legislative session, no reform plan is yet in the works. The ideas for overhauling the property-tax-reliant system range from an income-tax hike to new taxes on food, riverboat casinos, and lottery tickets.

The current funding method for the nearly 2 million-student Illinois school system allows per-pupil spending averages to range from $3,100 to $14,000, depending largely on the property wealth of a given district. The state has the highest property taxes and the lowest income-tax rate in the Midwest.

For years, critics have denounced Illinois' method for financing schools as both inadequate and inequitable. But the courts have carefully avoided the issue and, time and again, promises and plans for change have been derailed by regionalism, partisan politics, and, above all, a huge aversion to any new taxes.

Pressure Is On

What makes this year's go-round different, observers said, is that Republican Senate President James "Pate" Philip and Democratic House Speaker Michael J. Madigan have said the issue is a top priority.

"There's more optimism this year than in the past. The government is lined up," said Larry McNeal, an assistant professor of education finance at the Illinois State University in Normal. "Members of both parties have said they're willing to provide additional funds."

"This is it," added Deanna Sullivan, the governmental-relations director for the Illinois Association of School Boards. "There won't be an opportunity to address education finance for another 10 years. The pressure is on."

Since politicians are comfortably between election years, seizing as thorny an issue as the Illinois finance system may be more feasible than in any other year in the foreseeable future, Ms. Sullivan said.

Avoiding Specifics

Learning a lesson from last year, when his proposal for a constitutional amendment to overhaul school funding was quickly rejected by GOP lawmakers, Gov. Edgar has avoided outlining specifics of his plan, conceding only it will include a property-tax cut and higher state taxes.

"We should be straight with taxpayers," Mr. Edgar said in his speech to the legislature. "We can't substantially reduce their local property taxes and make the system fairer without increasing some state taxes to offset the loss in revenues to school districts."

The governor renewed his support for the recommendations of a school funding task force led by former University of Illinois President Stanley Ikenberry, which called for a $400 million spending increase for education and a 25 percent property-tax cut. That plan would add up to a $1.5 billion cut in property taxes, coupled with income- or sales-tax increases of $1.9 billion.

The extra education funds, Gov. Edgar said, would allow the state to help poorer districts raise their annual per-pupil expenditures to at least $4,225.

Lawmakers Weigh In

Sen. Philip, who leads a 31-28 Republican majority in the Senate, supports school funding reform but is wary of tax increases beyond a revenue-neutral, dollar-for-dollar exchange for local property-tax cuts.

Aides say he is considering sources besides income taxes to offset a proposed property-tax cut, including a sales tax on food and new taxes on riverboat gambling and lottery tickets.

Rep. Madigan, returning to the speaker's post after Democrats regained control of the House, has indicated that he is considering tapping the state income tax to lower property taxes and raise more money for schools. He cautioned, however, that corporations should pay as well as workers.

Despite the lack of an early consensus over how to approach large-scale funding reform, many observers are upbeat.

"We're really pleased that state leaders have made it a priority," said Robert Haisman, the president of the Illinois Education Association, the state's largest teachers' union.

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