CITY OF CHAMPAIGN TOWNSHIP Advisory Referendum February 5, 2008

STATUTORY RESPONSIBILITIES

City of Champaign Township Responsibilities Township is one of 20 Coterminous townships in Illinois Statutory Responsibilities: - Appraising Property Values - Administering General Assistance

Belleville East St. Louis St. Clair County Madison County Alton Godfrey Granite City Quincy Warsaw Macomb Galesburg City of Peoria Bloomington Decatur Springfield Capital Zion Berwyn Cicero Evanston Oak Park River Forest Kankakee Danville City of Champaign Cunningham June 6, 2006 IL Township Map Survey of Coterminous Townships Coterminous State Receiving Not Coterminous Neighboring 0-50 miles Coterminous and Neighboring State Receiving and Neighboring

Who Governs Townships? Although townships are governed by an elected Board of Trustees, townships are also unique in that, it is a grass roots form of government, and gives a unique role to the average voter through the mechanism of the Annual Town Meeting.

ELECTORS GOVERN AT ANNUAL TOWN MEETING

How the Annual Town Meeting Works? At the Annual Meeting, usually held on the second Tuesday in April, voters, otherwise known as electors, can take a large number of actions concerning the township. Township electors can directly authorize through a motion many of the powers that are regularly exercised by the Board of Trustees. This includes, authorizing an advisory referenda to be placed on the ballot by the County Clerk.

April 10, 2007 Annual Town Meeting the electors, authorized by majority vote, to place an advisory referenda question on “Poverty” on the next regularly scheduled election in the City of Champaign Township.

Proposition To Restore the Level of General Assistance Funding “Shall the voters of the City of Champaign Township ask the Township Trustees to restore the level of general assistance funding by actively pursuing any and all means available to them in order to preserve the health and well- being of individuals, children, families and adults living in extreme poverty in our Township?” YES NO

What Effects Township Budget Tax Caps Property Taxe Levy Tax Rate Fund Balances TIF Districts Service Needs

TAX CAPS

Tax Caps Became effective with the 1997 tax levy Advantages Control the growth of property tax extensions Disadvantages A “blunt instrument” Not well-designed to deal with special situations Limit the Township’s ability to balance available cash with annual tax levies

What is the Property Tax Extension Limitation Law (PTELL) PTELL commonly referred to as "tax caps,“ is designed to limit the increase in property tax extensions (total taxes billed) for non-home rule taxing districts. PTELL limits increase in tax extensions on existing property, but adds an additional amount for new construction each year.

TAX LEVY

Property Tax Levy The tax levy is the amount of money requested each year by the township to perform the mandated township services. The levy amount extended to the township is restricted by the tax rate multiplied by the EAV (equalized assessed value) minus the tax caps, minus the exemptions and minus the TIF district restricted revenues. The township “Capped” Levy for 2006 was $422,

Tax Levies

Tax Levies 1995 – 2005 by Fund

TAX RATE

Tax Rate Is a percentage applied to each taxing body's assessed valuation which will produce the amount of that taxing body's levy, or, in other words, the levy divided by assessed value equals the tax rate. The tax rate is expressed in terms of "dollars per $100 of assessed value". Townships current tax rate=.0357 Next Year’s Proposed tax rate =.0333

Tax Rates by Taxing Body

The Declining Tax Rate 1996 – 2007 YEARRATE % % % % % % % % % % % %

Rate Comparisons with Cunningham Township in Urbana Revenue Source Property Taxes Extended 2006$422,281$860,059 Tax Rate Property Taxes Extended 2007$453,636$917,175 Tax Rate City of Champ - Urbana

Tax Rate Comparison

TIF DISTRICTS

Tax Increment Financing Districts (TIF) TIF districts are a financial tool used by the city to help reinvest in blighted areas. Currently there are three TIF districts in Champaign. TIF districts freeze the EAV for a period up to 23 years and reduces the amount of tax revenues to the units of local governments. The township’s revenues have been reduced by lost tax revenues of as much as $98,000 over the course of the TIF districts in Champaign

FUND BALANCES

In 1998, one year after “tax caps”, a lawsuit was brought forth to limited the amount of funds a taxing body could keep in their reserves. In order for the township not to be exposed to lawsuit, available fund balances were used which lowered the tax rate and the levy amounts A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities. The township maintains four individual governmental funds.

Limits on Fund Balances Some taxing bodies carried large fund balances Several times greater than annual expenses Lawsuits resulted Courts decision - balances too high City of Champaign Township had to reduce fund balances to prevent exposure to lawsuit Result: lower tax rates

INCREASE IN SERVICE NEEDS

Service Need Comparisons From 2005 – 2008 Fiscal Year Fiscal Year 2005 Clients Served 304 Total GA Payments $62,244 Fiscal Year $299,985 Fiscal Year $152,655 1 st Quarter 2008 Projection is to serve approx. 625 clients 156 $23,388 February of 07 Terminated over 60 GA Clients ~ 50% City of Champaign Township

Service Need Comparisons with Cunningham Township in Urbana GA Case Load July 06 – June 07 Total Clients Served Basic Maintenance Payments $177,189 $137,617 Medical Payments on behalf of clients $18,526$116,925 Total Combined Payments on behalf of clients $195, ,542 NOTE: Cunningham Township is HALF the size of City of Champaign Township City of Champ - Urbana

OBLIGATION TO SERVE THE POOR

Township Has A Legal Responsibility To Serve The Poor Townships are mandated by Illinois State Statutes to provide General Assistance to the poor. Under the Illinois Public Aid Code, any individual who satisfies the eligibility requirements, such as financial need and residency, is entitled to receive aid through the Township General Assistance fund. 305ILCS 5/6-1 and 305 ILCS5/6-1.1

Obligation to Serve the Poor Specified in State Statute Any individual who meets eligibility requirements is entitled to Township General Assistance Regardless of Level of Township Revenues

General Assistance Often considered the public assistance “of the last resort.” Administered throughout Illinois by Township Supervisors (except Chicago). Illinois State Law requires townships to provide General Assistance.

Poverty in the City of Champaign Found in wealthy and poor cities Affects men, women, and children 13,398 individuals in the City of Champaign (22.1%) live below the poverty level (U.S. Census 2000) Of these 13,398 individuals, roughly 18% (over 2400) are non-student City of Champaign Township serves roughly 4% of the 2400 poor non-student individuals

Poverty Rates by Race Champaign County1999 Asian35.8% African-American30.4% Hispanic29.6% White12.1% City of Champaign1999 Asian10.0% African-American21.8% Hispanic5.9% White57.85%

In Conclusion

Township Revenues Property Taxes comprise 90% of all Township revenues Current rate: $16 for a single-family home with market value of $150,000 Township receives less than one-half of one-percent of the entire property taxes levied in Champaign

The 7 Budgetary Constraints A Blueprint for A Financial Storm Tax Caps Property Tax Levy Low Tax Rate Legal limits on fund balances TIF Districts Increased Service Needs

The Outcome of PTELL An Inflexible Blunt Instrument Tax Caps (PTELL) Slows Revenue Keeps Levy artificially Low and cannot Be Significantly raised Lowering Tax Rate Diminishing Fund Balance Reserves TIF Districts skim much needed tax resources off the top A surge in Service Needs RESULT: A Critical Financial Crisis Solution: Long-Term Solution ~Tax Referendum

Advisory Tax Referendum The February 5, 2008 Advisory Referendum will be a precursor to a hopeful successful binding referendum on the November 2008 Ballot allowing the township a one time release from the tax cap to adjust the township rate to a sustainable level with the ability to operate the townships mandated services.

Conclusion Township has a clearly defined obligation to provide assistance to the poor Obligation does not depend on the availability of General Assistance funds Revenue increase is necessary to meet this obligation Following increase, City of Champaign Township tax rate would remain lower than comparable communities

CITY OF CHAMPAIGN TOWNSHIP Advisory Referendum February 5, 2008