Unit 5 board votes to give referendum another try in April; $12M deficit keeps growing
The Unit 5 school board voted Wednesday to return to voters in April with a referendum seeking an increase to a key fund’s tax rate cap.
District leaders say a growing structural deficit, now at $12 million and showing no signs of slowing, is behind the renewed push — just like it was the first time.
"Putting the question back out there, and having a greater discussion about what the impacts are if this doesn't pass, I think, is the first step," said board president Barry Hitchins.
The board met in a special session Wednesday, voting to place the referendum on the April ballot, because the filing deadline is less than a week away, he added.
Two months ago, district voters narrowly rejected an identical referendum question in the November election — with about 54% voting “no,” or a 2,659-vote margin. At the time, Unit 5 Superintendent Kristen Weikle had said “there are very difficult decisions that will have to be made" in light of the rejected measure.
The April proposal again calls for an 88-cent increase to the education fund tax rate, which would take effect in fiscal year 2025-2026. That would bring that fund's rate to $3.60 per $100 of equalized assessed value (EAV).
But district leaders say while the ed fund would go up with this proposal, the district's overall tax rate eventually would be lower than today's $5.51 rate per $100 EAV.
As previous building bonds get paid off, Unit 5 taxpayers would see that overall tax rate remain level the next two years and then start to drop off significantly, according to Unit 5. By 2026, taxpayers would see the current rate go down nearly 11 percent, or roughly $355 less for the average household.
If the referendum passes, the district would gain more than $20 million in property tax revenue, while Unit 5's overall tax rate by FY27-28 would amount to 70 cents less than it is today.
Without that influx of money, staffing and program cuts are likely in store to address the $12 million shortfall, said Unit 5 leaders.
More than 80% of the education fund goes to salaries and benefits, said Unit 5 finance chief Marty Hickman. "It's mainly people. So, that means programs for our students," would be negatively impacted, he said.
With Unit 5's current tax rate projections, the district's overall tax rate of $5.51 per $100 EAV would decrease to a $4.04 rate in FY27-28, once bonds are paid off. But a successful referendum — bringing that ed fund rate up 88 cents — would instead take the overall rate down to just $4.92.
Put another way, if "yes" votes prevail in April — the overall rate that would have decreased $1.47 over the next few years, instead results in a .59 cent decrease over the same time span.
Weikle said the current $2.72 education fund tax rate is among the lowest in central Illinois.
“If you look at neighboring districts, you’ll see that they all have a higher education fund rate. Well, the reason they’ve been able to do that is they’ve asked their taxpayers to approve a referendum, which they’ve done,” she said.
The April 4 election is when city council and school board members are elected. Municipal elections like that typically have lower turnout than a midterm election like the one Nov. 8.
Still, board president Hitchins said waiting to try the referendum in a year or two wouldn’t make fiscal sense. The district borrowed money to cover the next few school years, he said. But when those bonds expire, the deficit remains.
“You would be kicking the can further down the road,” said Hitchins, who also pointed to the referendum issue being fresh in voters' minds.
“Even though we lost the (November) vote, there was still momentum built, and people have gained an understanding of what the issues are and what we are trying to achieve,” he said.
The district plans to hold more community information sessions about the proposed tax rate increase over the next three months.
Neither Weikle nor the board offered any particulars Wednesday on what cuts might be made if the voters reject the referendum a second time.
Some ideas floated include increased class sizes, or fewer opportunities for students. That could range from extracurriculars being cut to fewer electives offered, or even having to shorten the school day, said Weikle.
“I think anything that someone could imagine happening in a school district, anything could be on a table” regarding possible cuts, she said after the meeting.
Tax-rate referenda like this one typically are difficult to pass. Less than 40% pass the first time, said board member Alan Kalitzky.
Several board members said putting the referendum question on the ballot again in April make sense, especially based on feedback they’ve been getting since the Nov. 8 election.
Many voters shared with board member Jeremy DeHaai that they didn’t initially understand what was at stake with the vote, he said. Many also told him they aren't clear what the impacts will be with the November referendum failing. Board member Kelly Pyle said she'd heard similar concerns from residents.
Making $12 million in cuts to the district would make the district unrecognizable, said Kalitzky, while board members Amy Roser and Stan Gozur added that continuing to use working cash bonds is not a fiscally responsible way to address the district's budgetary woes. The interest on those bonds amounts to taxpayer spending, just in a different way, said Roser.
Board member Kentrica Coleman said as Unit 5 leadership confronts this fiscal crisis, it's important to ask what is in the best interest of the students.
Brad Wurth, among nine candidates running for school board in the April election, spoke during the the public comment period Wednesday, urging the board to not try the referendum again in April. Even though the vote was close, he contended that November decision should stand.
"We heard pretty clearly from the community that this referendum is not something the community supports," he said.
The board next meets at 6:30 p.m., Jan. 18, in the auditorium of Normal Community West High School. There, Unit 5 leaders are expected to better outline what kind of cuts are in store for the district — if the education tax rate remains the same, Weikle said.