A group of suburban Chicago municipalities' has proposed a plan that would abolish local property taxes to fund schools and shift the financial burden to the state.

The plan, proposed by the DuPage County Mayors and Managers Conference earlier this month, said that school funding could come from "state general revenue sources such as the income tax and sales tax" and possibly a statewide propen tax only for schools.

Lynn Montei, the group's executive director, said the group hopes the plan will encourage discussions among lawmakers to revise Illinois' school funding system.

Under the plan, school districts could levy local property tax revenues, but only if taxpayers were willing to pay higher education costs than deemed necessary by the state.

The enactment of property tax caps in five suburban Chicago counties spurred the group to look at the issue of education funding in the state, Montei said.

The tax caps, enacted in 1991. have dealt a serious blow to schools with no promise of replacement revenues or follow-up reform measures, she said.

"We never would be reviewing [the issue] if lawmakers did not take the first step with tax caps," Montei said, adding that the group is expected to formally endorse the plan in late September.

The caps limit annual increases in property tax collections by most local governments in the affected counties to 5% or the rate of inflation, whichever is less.

The DuPage County group plan was released in the aftermath of property tax reforms in two other Midwest states. Michigan blazed the trail over the past year by eliminating local property taxes for education. In addition, Wisconsin lawmakers m May approved a plan requiring the state to pick up 66.5% of school operating costs by 1997.

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