Since the cost of bonds is at an all-time low, the Lincoln-Way High School District 210 Board of Education on Dec.13 authorized a plan to restructure its $225 million in bonds. Despite the approved $3.5 million tax levy increase for 2012, the restructuring works to bring the actual tax rate down.
According to the tax rate should drop between 5-7 cents. At a minimum, the restructuring brings the rate down from $1.83 to $1.78. He likened the restructuring to a basic home mortgage refinance plan. When the rates drop below the initial percentage, homeowners typically refinance the mortgage to take advantage of the lower monthly cost.
"We're selling bonds at a lower rate. …It's going to reduce the (tax rate). …We basing this on the assumption that the CPI (Consumer Price Index) will go up by 3 percent," said Wyllie in a presentation at Lincoln-Way Central High School. The exact amount remains a mystery until April when the Will County Clerk reveals the tax rate.
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The restructure is expected to be finalized by February. This is time enough for the Clerk's Office to include the calculations in the tax bills. This particular bond and interest program is attractive because of its "call feature," which allows the district in another 10 years to "free up $200 million to build a new high school (in Manhattan,)" said Wyllie.
Construction is slow now, but it's anticipated to pick up, he added. The community of Manhattan is expected to begin growing again as the economy improves.
Tax levy specifics
For the first time in four years, the tax levy for Lincoln-Way High School District 210 is slated for an increase of roughly $3.5 million.
The total property taxes to be levied for 2012 are $77,927, 589,
“As you know from previous levies, levying a certain amount does not guarantee that the district will receive the amount requested. For example, our 2011 levy was $74,416,681, while the actual amount extended was $69,951,870. The final official equalized assessed valuation for the district, the prior year’s extension, new property value, the adjusted tax rate, and the consumer price index all help determine the amount of local property tax dollars that the district will receive.”
It's tough to discuss the tax levy rate in terms of cost per household, said Sawin. At this time, "we don't know the tax rate."
School districts must approve their tax levies in December, and that's before the official assessed valuation of homes is determined. Thus, the district always requests more in taxes than it will actually get.
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