School Consolidation Plans Could Threaten Federal Funding for District 210

A bill pending in the Illinois House calls for the mass consolidation of all of the state’s 868 school districts — a move that would likely eliminate a longtime source of federal funding for .

House Bill 1886, filed Feb. 16 by state Rep. Robert Rita (D-Blue Island), calls for the elimination of “all school districts in this state in existence on June 30, 2012 (other than the Chicago school district).” Under the proposal, each county would have either one or two school districts governed by a county school board.

The bill was introduced the same day Gov. Pat Quinn delivered his budget address and suggested that $100 million in administrative costs could be saved if at least 500 school districts were eliminated.

Illinois Superintendent of Education Chris Koch said he agrees the state needs to take a “considerable look at consolidation” and evaluate areas of inefficiency, according to story written by Andrew Thomason of Illinois Statehouse News.

In Lemont, one of the immediate results should the bill pass would be the loss of Impact Aid, a federal program that reimburses public school districts for the loss of taxable land to the federal government. District 210 qualifies for the funding because its boundaries encompass Argonne National Laboratory, a federal research facility exempt from paying local property taxes on about 3,600 acres of land.

According to Tony Hamilton, District 210's director of school and community relations, the district has received more than $10 million in Impact Aid since 1988.

Under Section 8002 (Title VIII of the No Child Left Behind Act), districts that lose at least 10 percent of the assessed value of their taxable property to the federal government are eligible. Cass School District 63 in Darien and Community Consolidated School District 180 in Burr Ridge also qualify for federal assistance because of Argonne.

Should the consolidation proposal become law, all school district boundaries would be redrawn and it's unlikely Argonne would make up 10 percent any new school district formed, District 210 Supt. Sandra Doebert said.

“The governor is proposing school districts with anywhere from 30,000 to 35,000 students, so Lemont High School would become part of a large, far-reaching district,” she said. “Because of the way the law is written, we would, in all likelihood, lose Impact Aid.”

The Impact of Impact Aid

The Impact Aid statute was signed into law by President Harry Truman in 1950 as a way to reimburse school districts for the loss of property tax revenue. The legislation recognizes two types of federal impact: that of dependent children of federal employees and military personnel and the loss of taxable land.

The latter, recognized today as Section 8002, qualifies approximately 245 school districts — eight of which are in Illinois — for Impact Aid funding.

In Lemont, the federal funds are used for "textbooks, lab equipment, computers, light, heat, teachers and support services, among other costs," according to the District 210 Web site.

"Impact Aid is not grant money or a special type of funding," Doebert said. "The districts that receive this money do so because it is owed to them. It compensates for the loss of tax dollars that would otherwise go toward educating children."

When District 210 began receiving Impact Aid funding in 1988, the first payment was $12,455. The payment increased to $955,175 in 2006 when a change was made in the way properties were assessed.

Currently, due to a freeze in spending by the federal government, districts do not receive all of the funding they are entitled to, nor do they receive payments on time, Doebert said. Additionally, more schools now qualify for Impact Aid funds than ever before, meaning the same amount of money is split between more districts, she said.

According to a recent report in USA Today, the Department of Education reported that $896 million in Impact Aid was distributed for the current fiscal year — about $1 billion less than what school districts were entitled to receive under the funding formula. Only 128 of more than 1,300 eligible districts receive their full share, the report said.

District 210 receives about five cents on the dollar for what it actually qualifies for, Doebert said.

Because of the variability of payments, federally impacted school districts are forced to budget conservatively.

"There's a huge lag time with payments now, so what the school district receives in any given year could be characterized as unpredictable at best," Doebert said. "However, we have worked hard to be fiscally responsible and plan accordingly."

According to Hamilton, the most recent completed payment received by District 210 was for the 2007 fiscal year. The district has received partial payments for 2008, 2009 and 2010 and is currently owed about $1 million, he said.

Taking the Lobbying Lead

Prior to 1994, Impact Aid payments were based on the classification of the land at the time it was acquired by the federal government. Therefore, if the land was categorized as agricultural at the time of acquisition, the aid would be assessed at present-day value of agricultural land.

However, thanks to the efforts of former District 210 Supt. Tom Madden and local state representatives, Impact Aid allocations are now made using the "highest and best use formula," which takes into account the current usage of the taxable property adjacent to the federal property. The change significantly increased payments to District 210 and other area school districts, Madden said.

In fact, District 210 has been involved in helping shape the Impact Aid program since former Supt. John Murphy first applied for the money in 1988, Madden said.

For two decades, the district has been a member of the National Association of Federally Impacted Schools, a nonprofit corporation of school districts organized primarily to educate Congress on the importance of Impact Aid. Twice annually, the District 210 superintendent and school board president visit Washington to ensure funding continues — and increases, if possible.

"It takes a lot of time to really understand Impact Aid and its importance, so it's crucial that educators work with their local representatives to educate legislators nationwide," Madden said. "Sandy (Doebert) has done an excellent job of representing not only the district, but the entire network of impacted schools."

Doebert is the former president of the Section 8002 Organization and is a current member of of the national association's board of directors.

"It is my duty as a superintendent to ensure that this district is receiving the maximum amount of federal funding possible, and that legislators are aware of how important this money is to federally-impacted schools," she said.

Doebert has worked closely with U.S. Rep. Judy Biggert (R-Hinsdale), who also works with the association to lobby for increased Impact Aid funding.

"Argonne is a wonderful laboratory, but we need to make sure that its presence doesn't come at a cost to students and educators," Biggert said during a November interview. "I fully support Impact Aid and its benefit to every child and the community at large."

Future of Impact Aid in District 210

Because Impact Aid funding is reauthorized annually by the federal government, District 210 officials said they must be diligent in their work with NAFIS. Just this week, Doebert traveled to Washington D.C. to discuss the issue with legislators.

"Budget discussions are underway, so it's crucial that everyone understands the merit and purpose of Impact Aid, particularly those recently-elected officials that may not be as familiar with the program," she said.

As for the proposed consolidation bill, Doebert said she and school district officials across the state will be forced to wait for more information on the governor's plans and what they would mean for existing districts.

"Consolidation is not a bad idea in all cases, but I don't think it can be a blanket move just to save money," Doebert said. "Our state needs to look at the reality of the situation for each and every school and evaluate the potential consequences. As it stands, I think it might be a fiscally unsound decision."

Though attempts to reach Illinois Sen. Christine Radogno (R-Lemont) were unsuccessful, her spokesperson, Patty Schuh, said the senator's office was "monitoring the consolidation proposals very closely at this point," but declined to comment on any specific measures or consequences.

"As far as we know, these are just proposals, so we'll be watching closely in the coming months to see how they play out with state leaders," Schuh said.

For now, Doebert said she will continue to be actively involved as an advocate for District 210 and Impact Aid. With a spending freeze still in effect, she said district officials would be "good stewards" and budget accordingly.

"Whatever we're going to receive, we know we can't be dependent on it," Doebert said. "But it is still so important that we work to get these federal dollars that are owed to our students. In these times especially, we need to defend those tax dollars that we lose to Argonne."