Illinois school districts urge support for additional 1% sales tax to
fund facilities
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[February 15, 2025]
By Catrina Barker | The Center Square contributor
(The Center Square) – McLean County school districts are urging
residents to join other Illinois counties in supporting a sales tax
increase officials say is "essential” for school facility needs “without
raising property taxes."
Originally, The McLean County schools website said “school districts in
McLean County are asking voters to approve a 1% County Schools Facility
Tax.” Now the website says, “school districts in McLean County are
asking voters to consider a 1% County Schools Facility Tax.”
Bloomington District 87, Tri Valley, Heywoth and other area school
districts shared the website that says it’s estimated 35% of the
proposed one-cent tax revenue would be generated by visitors, commuters
and non-residents of McLean County.
Bryce Hill is the director of fiscal and economic research with the
Illinois Policy Institute.
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“Property taxes are, generally speaking, a pretty good mechanism for
funding schools because they adhere to what's referred to as the user
benefit principles of taxation. So, that is that those people that live
in the districts that benefit from either being able to send their
children to public schools directly or who benefit from things like
higher property values because they live in a good school district,”
said Hill.
On April 1, 2025, voters in McLean County will decide on the proposed 1%
County Schools Facility Tax, which districts have dubbed the “one-cent”
tax. McLean County voters shot down a similar tax proposal in 2014.
"They call it a one-cent tax as a sales tactic to make it seem like it's
not that much,” said Hill. “It would be a 1% sales tax in addition to
things like your state sales tax, your local sales taxes, all of those
things.”
According to proponents, the additional tax will address school safety
and facility needs in McLean County public schools. Proponents also
claim it will provide property tax relief.
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According to Effingham Unit 40 school district, 57 counties have a
tax exactly like or similar to the proposed County Schools Facility
Tax.
Hill said it’s a growing trend and more Illinois counties are
approving ballot initiatives that create an additional tax.
“As far as whether or not this type of tax is better than a property
tax, first, property taxes are extremely high in Illinois and school
districts are the number one source of property tax levies,” said
Hill. “The property tax has a levy that local government districts
can choose to set at certain amounts. So there could be lots of tax
layering going on that makes it incredibly important for taxpayers
to be vigilant, especially when considering that 1% here, 1% there,
the numbers really stack up, especially with recent changes at the
state and local level.”
Hill explained most local governments are expected to increase the
local sales tax to make up for Gov. J.B. Pritzker’s eliminating the
statewide grocery tax that takes effect Jan. 1, 2026.
“Part of those negotiations allowed all local governments to have
the ability to implement a 1% sales tax on groceries, but also gave
non-home rural units of government the ability to increase their
general sales tax rate by up to 1% without a referendum,” said Hill.
Hill said McLean County property taxes are higher than the statewide
average.
“McLean County does not have PTEL [Property Tax Extension Law
Limit]. So, part of an issue with property taxes is that local
governments can raise them unabated in some circumstances where
there's no property tax extension limitation law,” Hill said. “They
can rise rapidly, and Illinois is home to the second highest
property tax rates in the nation. In McLean County, they're actually
slightly higher than the statewide average. They're at 2.2% [of a
home's value]. Statewide average is right around 2%.”
The combined state and local sales tax rate in Illinois is seventh
highest in the country. It averages 8.85%. That’s higher than any
other Midwestern state and higher than any neighbor states,
according to the Tax Foundation.
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