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GOVERNMENT RELATIONS


Alliance Legislative Report 97-37

Distributed via Email: January 20, 2012

LEGISLATORS GEAR UP FOR NEW SESSION

The Illinois General Assembly will return to the Capitol to start the spring legislative session at the end of the month. Both the House of Representatives and the Senate are scheduled to return Jan. 31-Feb. 2, and will then, generally, meet each week through the end of May.  

Lawmakers tackled many heavy issues last year, including: education reform, worker’s compensation reform, Medicaid reform, an income tax increase, and several weighty social matters. With those accomplishments under their belt, and going into an election year in which every legislator will be running for office in a new district because of legislative redistricting, legislative leaders are likely to cut back on the agenda for 2012.

However, many issues from last year are bound to return. Task forces, commissions, or panels were formed to look into school district consolidation, streamlining of Regional Offices of Education, instructional mandates in schools, and pension reform. These panels have either submitted their reports or will be preparing their reports this spring, thus likely leading to legislation regarding their recommendations.

The budget, of course, is always the centerpiece of legislative discussions, and that will not change this year. One thing in which all legislators agree, despite their political party, is that it will be another lean fiscal year for the state of Illinois. The overall state budget will likely be cut beyond FY 2012 levels, including education funding. Specifically, the school district transportation reimbursement formula could be significantly altered, thus reducing the amount necessary for the state to spend on transporting students.

Here is a look at some of the upcoming issues:

TRANSPORTATION REIMBURSEMENT

There has been much discussion about possible changes to the state’s transportation reimbursement formula for school districts. The past two years, the governor and legislature have cut the transportation payments to a 74% proration level. Now the Illinois State Board of Education (ISBE) is exploring proposals that would either require more efficiency among school districts in transportation services, or find ways to offer less transportation options in an effort to reduce these costs.

About 15 years ago, there was also a push to revise the transportation reimbursement formula. At the time ISBE was looking at options such as:

  • Combining the regular transportation and the special education transportation appropriations to streamline the distribution of funds;
  • Increasing the permissive tax levy for unit districts from .20 to .24;
  • Allowing all forms of transportation to be reimbursable; and
  • Reimbursing school districts only (not vocational centers or special education cooperatives) based on a two-tiered system requiring a local effort and a statewide average cost per pupil

Some of these proposals may be non-starters in the current fiscal climate as many of these options would actually increase transportation costs. So, this year, the following proposals are being discussed at ISBE:

  • Moving to a per mile or per pupil reimbursement;
  • Making student transportation permissive for all school districts, instead of mandating such transportation (and allowing school districts to charge a fee to transport students);
  • Eliminating transportation reimbursement of all vehicles other than school buses;
  • Eliminating the flat grant funding for the 119 school districts that receive transportation this way instead of through the formula;
  • Eliminating transportation reimbursement to school districts that use mass transit for transportation of students;
  • Eliminating all transportation reimbursement funding for the school districts that are not currently mandated to provide transportation (this includes 387 school districts, including all but five of the high school districts in the state); and
  • Extending the mileage threshold for free transportation beyond the current 1.5 miles

The Alliance is included in the transportation reimbursement discussions. Please share your opinion of these possible options with the Alliance lobbyists, legislators, and ISBE.

PENSION REFORM

The call for reform of the state’s pension systems, including the Teachers’ Retirement System (TRS), has only grown louder over the legislative off-season. Governor Pat Quinn is forming a panel to look into the matter and Senate President John Cullerton has vowed to address the issue this spring. Both Quinn and Cullerton have called for shifting as much as $800 million of the cost of the teacher pensions to local school districts. That, of course, would result in either an $800 million cut to public education funding or, if a levy is provided, an $800 million property tax increase for local taxpayers.

There is also still a plan pending that would make pension changes that would affect employees who currently participate in the TRS. In a House amendment to SB 512, TRS-participating employees would have to select a pension plan from three options: remain in the plan with the current TRS benefits but pay a higher contribution rate; change to the “Tier II” plan and pay a lower contribution rate; or participate in a 401(k) type plan.

A pension reform bill is likely to be called for a vote in the Capitol this year. The Alliance continues to be involved in the discussions.

REGIONAL OFFICES OF EDUCATION

When legislators finally agreed to pay the salaries of the Regional Superintendents of Schools by using receipts from the Corporate Personal Property Replacement Tax (CPPRT), they also established the “Streamlining Illinois’ Regional Offices of Education Commission”. The commission is charged with examining the Regional Office of Education (ROE) duties to see if there is a more appropriate or efficient method to deliver these services to school districts. The deadline for the commission to submit its report is Aug. 1, 2012. However, there has been legislative agreement to move this reporting deadline up to April 1, 2012 (contained in SB 2566).

There are some legislators that question if ROEs are needed at all. Others believe that some of the duties of the ROE could be shifted to other entities, while still others would like to see the number of regions significantly reduced from the current 45.

SCHOOL DISTRICT CONSOLIDATION

The School District Realignment and Consolidation Commission, now known as the “Classrooms First Commission”, has moved into its second stage of work. The commission has broken into smaller work groups focused on the following issues: shared services, within-district efficiency, and realignment. Throughout January, February and March 2012, the work groups will meet to develop a set of draft recommendations.


The third stage will begin with release of the commissions draft recommendations. The public will have the opportunity to comment on these recommendations through a second round of public hearings across the state or by submitting comments online. After collecting public input on the draft recommendations, the commission will make a final proposal to the governor and general assembly by July 1, 2012.

INSTRUCTIONAL MANDATES TASK FORCE

The Instructional Mandates Task Force made its final report last summer, containing several positive recommendations regarding mandates on school districts. Legislation will likely be considered this spring to implement some of the recommendations, including flexibility around requirements for physical education, drivers’ education, bilingual education, and curricular mandates. You can access the task force report here.

OTHER ISSUES

As school administrators and teachers begin to implement the changes in the new education reform act (SB 7) and the new teacher licensure law (SB 1799), there will likely be flaws found in the new laws or other unintended consequences that need to be re-visited. “Trailer bills”, bills that follow up on previously passed legislation to make corrections, could emerge this spring to address these two significant education bills.

SCHOOL BOARD MEMBER TRAINING SESSIONS

Two pieces of legislation enacted last year contain new requirements for school board member training. Public Act 97-0008 (SB 7), the education reform bill, r equires school board members to receive a minimum of four hours of professional development leadership training within one year of the beginning of the board member’s term. The topics that must be covered are education and labor law, financial oversight and accountability, and fiduciary responsibilities of a school board member. The school district must post on its website the names of the district’s school board members who have completed the training.

Public Act 97-0504 (SB 1670) requires elected officials (including school board members) to successfully complete the training program provided by the Attorney General’s Public Access Counselor regarding the Open Meetings Act or Open Meetings Act training conducted by the Illinois Association of School Boards. Mandatory board member training that satisfies Public Act 097-0008 is now available via IASB's Online Learning Center. This course, "Professional Development Leadership Training for School Board Members," includes instruction in the required topics of the new Act.  Board members appointed since June 13, 2011, for a term of one year or more, will need to take this course within 1 year of their appointment. The remaining board members will not be required to take this training until they are next re-elected.

IASB is offering Open Meetings Act Training for school board members in each of its 21 geographic divisions this spring. Attendance at this program satisfies the requirements of Public Act 97-0504. The presentation is designed specifically for school board members and addresses some of the unique issues applicable to school boards. A certificate of completion will be provided. Some divisions will offer the training as break-out sessions during their spring division meetings, others will offer the training as a pre-meeting session prior to the spring division dinner meeting, and seven divisions will offer the training as a stand-alone event. For dates and locations in your division, visit www.iasb.com and click on Events Calendar, then View Upcoming Events. A registration fee is required and space is limited. Please register early.

RECENT ACTION BY THE GOVERNOR

SB 50 (Silverstein, D-Chicago) makes changes to the Liquor Control Act in the provisions regarding the sale of alcohol near a school in the City of Chicago. The bill is now Public Act 97-0634, effective Dec. 16, 2011.

SB 165 (Jacobs, D-Moline) extends the Tax Increment Financing (TIF) district in Moline to 35 years (instead of 23 years). The bill is now Public Act 97-0635, effective Dec. 16, 2011.

SB 397 (Hutchison, D-Olympia Fields) contains corporate tax incentive provisions. Generally, it provided about $85 million in incentives for the CME Group and $15 million in breaks for Sears, along with some provisions for other, smaller entities. Specifically, it: c reates Illinois Independent Tax Tribunal; creates the Live Theatre Tax Credit capped at $200 million annually; extends the current Sears Company Economic Development Area agreement in Hoffman Estates; extends for five years the Investment Tax Credit; extends for five years the Research and Development Tax Credit and allows for carry-forward; grants five-year extension to all tax credits expiring in 2011, 2012, and 2013; changes income tax apportionment formula for the CME Group; allows Sears to utilize EDGE Credit against withholding liability; extends lower tax rate on Gasohol and Biodiesel fuels; increases Estate Tax Exemption level from $2 million to $4 million by 2013; extends for five years the New Markets Tax Credit; allows Champion Labs to utilize EDGE Credit against withholding liability; extends Business Location Efficiency Incentive through calendar year 2016; extends for five years the Small Business Job Creation Tax Credit; extends the Food and Drug Sales Tax Exemption to individuals receiving public aid, and; extends the Historical Society Property Tax Abatement Period through calendar year 2018. The bill is now Public Act 97-0 636, effective July 1, 2012.

SB 400 (Hutchison) contains the individual taxpayer provisions. It increases the Earned Income Tax Credit for low-income families from 5% to 10% of the federal tax credit. The bill also increases the personal income tax exemption for all Illinois taxpayers from $2,000 for every person in a household to $2,050 per person. The bill is now Public Act 97-0652, effective June 1, 2012.

SB 1226 (Maloney, D-Chicago) addresses the limits in enrollment for the agricultural science school in Chicago. The bill is now Public Act 97-0648, effective Dec. 30, 2011.

SB 1311 (Steans, D-Chicago) is the budget implementation bill for the appropriations in the budget agreement brokered in November 2011. Specifically for schools, it states that the funds appropriated for the new State Charter School Commission may be used for “personal services, contractual services, and other operational and administrative costs”. The bill is now Public Act 97-0641, effective Dec. 19, 2011.

SB 2412 (Steans) is an appropriations bill that redistributes funds among current state budget line items. From funds that resulted in the governor’s budget cuts, $202 million was diverted to allow state facilities to remain open and offer services, such as downstate correctional facilities and mental health centers. Other funds were directed to: alcohol and substance abuse programs ($28 million), community mental health programs ($30 million), funds for burying the indigent ($8 million), homeless services ($4.7 million), and hospital funding and reimbursement ($276 million). The bill is now Public Act 97-0642, effective Dec. 19, 2011.

HB 384 (Mautino, D-Spring Valley) provides that if a person is entitled to a warrant or payment from the State treasury and if a unit of local government, school district, or public institution of higher education holds a then due and payable account or claim against that person, then the state comptroller may deduct, on behalf of that entity, the owed amount from the warrant or payment. The bill is now Public Act 97-0632, effective Dec. 16, 2011.

HB 507 (Mitchell, J., R-Rock Falls) extends the Tax Increment Financing (TIF) districts in Dixon and Lansing to 35 years (instead of 23 years). The bill is now Public Act 97-0633, effective Dec. 16, 2011.

HB 3813 (Cross, R-Oswego) addresses TRS participants’ leaves of absence during which a participant is employed by a labor organization. The bill is now Public Act 97-0651, effective Jan. 5, 2012.

This legislative report is written and edited by the lobbyists of the Illinois Association of School Boards to provide information to the members of the organizations that comprise the Illinois Statewide School Management Alliance.

Bill Text/Status: Illinois General Assembly www.ilga.gov


Alliance Legislative Reports are Cosponsored by IASB and:
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