'The State has determined that $1,260 per student in average daily attendance (ADA) is the amount necessary for school districts to educate a child'

earlier.)

Obviously, computing State aid by such complex formulas is confusing. It does appear to be among the most complicated of Slate aid formulas in the nation.

House Bill 1484 was introduced in the 1973 legislative session to simplify the procedures, as well as to eliminate the penalty for dual districts. As the bill worked its way through the legislature, various changes and amendments were added on. The net result of these changes was that all of the previous methods of calculating State aid were retained and the "resource equalizer" was added as an option. A district must therefore calculate its State aid by all methods to determine the maximum amount possible.

The basic State aid equation has three components: assessed valuation, tax rate, and revenue. The Strayer-Haig approach guarantees a revenue amount; the "resource equalizer" guarantees the assessed valuation; and the "power equalizer" (not used in Illinois) guarantees a given return on the tax rate applied. All are designed to provide slate money to supplement locally raised educational funds.

'Resource equalizer' option
The "resource equalizer" works like this: The State has determined that $1,260 per student is average daily attendance (ADA) is the amount necessary for school districts to educate a child. Since some school districts have less assessed valuation than others, it is difficult for them to come up with this amount without levying exorbitant lax rates. The State has said (H.B. 1484) it will make up the difference between the $1,260 and the amount produced per pupil by the local school district's operating taxes,* provided that the school districts levy their operating taxes at or above a specified rate (3.00 per cent for unit districts, 1.05 per cent for high school districts, and 1.95 per cent lor elementary districts). H.B. 1484 also requires tax rates above these maximums be lowered each year by 25 per cent of the amount by which they exceed the maximum. In effect, this system places a higher valuation on the taxable property, or resources, of poorer school districts (thus the name "resource equalizer") in order to guarantee $1,260 per ADA.

The "resource equalizer" guarantees a property valuation per weighted student of $42,000 for unit districts, $64,615 for elementary districts and $120,000 for high school districts.

Table II shows the key values for comparing how districts of different types fare under the plan.

Because of the differential in threshold tax rates and guaranteed valuations per student for the three categories of districts as shown in Table II, only high school districts can easily qualify for State aid under the resource equalizer formula; but only 15 of 446 unit districts are eligible.

It is difficult for unit districts to raise their operating tax rates to the threshold level required for the resource equalizer State aid because referenda are required to raise their operating tax rates above 2.075 per cent which is .925 per cent below the required rate. But, for high school districts, no referenda is needed since their maximum operating tax rate by statute is 1.27 per cent, which automatically would qualify them for resource equalizer State aid.

The authors of H.B. 1484 clearly intended to design a plan by which the Stale would contribute more than half. of all operating revenue to school districts. If districts whose assessed valuation is more than half of the guaranteed valuation raise their rates, they generate more local revenue than Sate support, while the reverse holds true for districts below that point. It is too early to tell what voters are going to do in response to the incentives, but a quick glance at districts' operating referenda for the past two years may give some indication.

Taxpayer's perspective
From Table II, it appears that the taxpayer gets an even break whether he pays taxes to a unit district or whether he pays taxes separately to a high school and an elementary district. In both cases he would pay the same: 3.00 percent. On the other hand, the taxpayer who pays taxes to both a high school and an elementary district would have no chance to approve or disapprove an increase to the combined 3.00 per cent tax rate — a tax rate which would need referendum approval in a unit district.

Another comparison should be made from the perspective of the local school

*0perating rates for calculating Slate aid by the "resource equalizer" method includes all tax rates except those for bonds and interest, rent, special education construction, vocational education construction, summer school, capital improvement and transportation.

Table II
Key Values for Resource Equalizer

Type of District Elementary High School Unit

Guaranteed valuation/student $ 64,615 120,000 42,000

Threshold tax rate X 1.95% X 1.05% X 3.00%

Guaranteed amount per student = $1,260 = $1,260 = $1,260

Districts eligible for resource equalizer aid* 76 of 507 140 of 146 15 of 446

* Figures from 1972 showing those at or above maximum tax.

Illinois Issues/February 1975/49