What the proposed TIF would mean for District 29

The Middlefork project and our fund balance

This TIF threatens our ability to pay for the Middlefork project we have committed to delivering to future generations of District 29 students. As currently proposed, we may not be able to follow through on the payment approach as originally forecast. The Village has cited District 29’s fund balances in an effort to make the point that our fund balances can withstand the negative financial impact of the TIF District.

District 29's fund balance is projected to be just under $10 M in Fiscal Year 2027 after the Board's planned spend down of $11.5 M to support the new Middlefork School. School districts are recommended to keep strong fund balances, and fund balance ratios are a key metric for measuring a school district’s credit rating and financial rating. District 29 has been a good steward of taxpayer dollars for decades.

New enrollment without new revenue

The proposed district includes a 92-unit residential development that is already an active project. New homes may mean new students.

Illinois law normally allows school districts to capture the value of new construction in the tax levy. That is how districts fund the cost of educating the students that growth brings. Under the TIF, those funds would be unavailable for up to 23 years, and statutory reimbursement carries restrictions and limits that may not cover the full cost. Closing that gap could force difficult decisions, such as increasing class sizes.

Budget gaps without new property revenue

Even without new students, losing new-construction revenue significantly affects our budget over time. Under Illinois law, District 29 can increase property tax revenue only by the lesser of 5% or CPI, plus new property construction.

Pilewski Financial projects that District 29 would lose more than $12 million in property tax revenue over the TIF’s 23 years from that single 92-unit development. We could capture the growth once the TIF expires, but there is no way to recover what is lost along the way.

A “hidden” tax increase

Before putting a ballot question before the community, we carefully considered the tax impact on our residents. The Board strives to provide a world-class education at a locally competitive tax rate.

If this TIF is created, growth in the value of TIF parcels is set aside for the TIF fund rather than added to the district’s taxable base. The same levy spread across a smaller base produces a higher tax rate, and that rate applies to every property in the taxing district. The effect on an individual bill may be modest, but it is real.

The Village’s own Vision Plan 2040 calls to “ensure that the new residential developments do not adversely impact the capacity of school facilities or funding.”