Presentation to
Piatt County Schools
February 13, 2014
Illinois County School Facility Tax
Public Act 97-0542
Presented by Stifel, Nicolaus & Co., Inc.
Anne Noble
Senior Vice President
800-230-5151 x8488
noblea@stifel.com
Kevin Heid
Senior Vice President
309-661-0004
heidk@stifel.com
Sean McCarthy
First Vice President
800-230-5151 x2737
mccarthys@stifel.com
Jim Burgett
First Vice President
618-830-9782
burgettj@stifel.com
Tom Crabtree
First Vice President
800-230-5151 x8457
crabtreet@stifel.com
70 West Madison Street, Suite 2400, Chicago, Illinois 60602
Telephone: 312/269-0329
501 North Broadway, St. Louis, Missouri, 63102
Telephone: 314/342-2993
2
2101 Eastland Drive, Suite B, Bloomington, Illinois 61704
Telephone: 309/661-0004
Stifel Nicolaus
The Illinois K-12 Finance Resource
Who we are:
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It’s pronounced Stee-fuhl
Stifel Nicolaus is a national brokerage firm and a leader in Illinois
bond underwriting with 24 offices in Illinois alone
Stifel focuses on Illinois K-12 finance
We provide full service financing from financial planning and
referendum assistance to ultimately delivering the lowest cost
financing on bond sales
Expert resource on Illinois K-12 bond financing (Health Life Safety,
General Obligation, Working Cash, etc.) including County School
Facilities Sales Tax issues
Stifel has created and produced a complimentary informational sales
tax video for Illinois schools to help begin discussions on the topic in
community forums
We hope that your District will allow Stifel Nicolaus the opportunity
to prove our ability to better serve your District the next time you
are considering a bond financing
Nontraditional Approach for Illinois Public Schools
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Sales tax vs. Real Estate tax for school capital
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–
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Law went into effect October 2007
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Law was based on similar law that is currently in place in every
county in Iowa

Law was amended in August 2011
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Allows county voters to approve a sales tax to fund school facility
costs
1% maximum in ¼% increments
County Board no longer has to approve the tax
Illinois County School Facility Tax Act:
Election Results and Future Votes
X
Counties where the CSFT
has passed (18)
X
Counties where the CSFT
failed in the November 2008
(X), April 2009 (X), February
2010 (X), November 2010 (X),
April 2011 (X) Elections,
March 2012 (X) Elections,
November 2012 (X)Elections
and (X)2013 Elections (41)
X
X
X
X
X
X
X
X X
X
X
X
X X
X
X X
X
X
X
X
X X
X
X
X
X
X
X
XX
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X
X
X
X
Counties where the CSFT
election is being discussed
for March 2014
X
X
X X
X
XX
Low Impact on Key Business and
Fixed Income Persons

Sales Tax Base:
–
Everything in the municipal and county sales tax base is
included in the tax base except for:

Cars, Trucks, ATVs
Boats & RVs
Mobile homes
Unprepared Food
Drugs (including over-the-counter and vitamins)
Farm Equipment and Parts
Farm Inputs

Services are not taxed
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
–
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“If it is not currently taxed, it will not be taxed”
Use of Sales Tax Revenues
Uses of Sales Tax
Ineligible Uses
New Facilities
Direct Instructional Costs
Additions & Renovations
Text Books
Security, Entrances, Safety, Disabled Access
Buses
Ongoing Maintenance
Detached Furniture & Fixtures
Architectural Planning
Computers
Durable Equipment (non-moveable items)
Moveable Equipment
Fire Prevention and Life Safety
Operating Costs
Land Acquisition
Salaries and Overhead
Energy Efficiency
Parking Lots
Demolition
Roof Repairs
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Refund Bonds or Abate Property Taxes
Levied to Pay Bonds Issued for Capital
Purposes
How to Use Sales Taxes

Pay as you go capital projects
–
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Issue new bonds for current capital needs
–
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–
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Support bonds with sales tax
Retire existing debt issued for capital purposes
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Sales tax can be saved up over time
Abate taxes
Refund qualifying debt
………Or any combination of the above
Interest on money received on a monthly basis and reserved for bond payments or
future construction projects may be transferred to the General Fund…
Education & Operation and Maintenance Fund
Benefit to Property Taxes
Two Ways to Decrease Property Taxes
1.
Reduce: A district can abate or decrease
existing property taxes by using sales tax
funds to pay off outstanding building bonds.
1.
2.
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Property taxes reduced on residential,
commercial and industrial properties
Avoidance: A district can avoid levying
property taxes by using sales tax funds to
pay for facility projects that would have
been paid for with property taxes
Impact of CSFT for Tax Capped Districts
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
CSFT revenues are outside of aggregate extension
base or GSA calculations

Alternate Revenue Bonds and Debt Certificates
backed by CSFT revenues do not count against or
require a debt service extension base “DSEB”
County School Facility Tax
Worksheet for Piatt County Schools
Debt Capacity and Abatement Impact Per District
1
2
3
4
% of
EAV in
the
2012 District Total County
County
District
EAV (1)
(1)
Piatt
Bement CUSD 5
$54,513,837
88%
Piatt
Monticello CUSD 25
$218,561,465
95%
Piatt
Atwood Hammond CUSD 39
$45,531,712
56%
Piatt
Deland-Weldon CUSD 57
$51,464,712
57%
Piatt
Cerro Gordo CUSD 100
$64,801,239
51%
Champaign Mahomet-Seymour CUSD 3
$274,078,469
0%
DeWitt
Blue Ridge CUSD 18
$121,399,113
36%
Total
$830,350,547
Value of a Student
$249
5
6
7
8
DRAFT
9
10
11
12
13
Estimated
Proposed Debt
Estimated 2013Potential
Issuance with 1%
14 Housed
Abatement
Effective
Annual Growth in
Enrollment
Fiscal Year 2014 Available Based Abatement $
Sales Tax, 1.25x
Final
adjusted for
Debt Service per on LESSER of
Amount per
2013-14
Adjusted Annual Coverage @ 5% Maturity of
County Resident
District from
CSFT Funds or $100,000 House
Housed Students by EAV Percent of
CSFT per
Rate for 20 Years
Existing
County Tax Rate FY 2014 Debt Value Based on
Enrollment
(2)
Total
District (3)
(4)
Debt
Sheet
Service
column 12
11.8%
401
341
$84,800
$916,052
12/1/2024
$223,010
$0.16
$51.85
55.3%
1,683
1,606
$399,382
$4,314,308
10/1/2020
$1,611,785
$0.18
$60.91
8.0%
416
233
$57,943
$625,924
12/1/2026
$392,705
$0.13
$42.42
3.4%
202
100
$24,868
$268,637
12/1/2015
$43,990
$0.05
$16.11
13.5%
617
392
$97,483
$1,053,057
12/1/2020
$354,074
$0.15
$50.14
0.0%
2,883
0
$0
$0
$1,703,390
$0.00
$0.00
7.9%
764
230
$57,197
$617,865
$527,238
$0.05
$15.70
2,902
100%
$721,673
$7,795,842
Prepared by Stifel Nicolaus & Company, Inc. For additional information please contact Tom Crabtree at 1-800-230-5151 ext. 8457
January 13, 2014
(1) As reported by ISBE Annual Financial Reports and County
(2) Enrollment of County resident students as reported by each district
(3) Based on County Sales Tax "CST" then multiplied by 4 to represent 1%, less vehicle estimate and 2% State Fee
(4) Assumes 1% annual growth in sales tax
The Money
Follows the
Student
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Calendar Adjusted Net CSFT
Year
at 1% (1)
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
$506,321
$488,637
$517,084
$594,450
$1,237,197
$596,795
$622,788
$616,493
$709,843
$725,102
$721,673
% Change
N/A
-3.49%
5.82%
14.96%
108.12%
-51.76%
4.36%
-1.01%
15.14%
2.15%
-0.47%
Local Sales Tax Rates
City
Champaign*
Decatur*
Farmer City
Galena*
Galesburg*
Monticello
Peoria**
Springfield
Tuscola
Sales Tax Rate
9.00%
9.00%
6.25%
8.25%
8.50%
6.25%
8.25-9.25%
8.50-9.50%
7.75%
*Includes new CSFT
** Hospitality Improvement Zone Business District 9.25%,
all other 8.25%
Source: Illinois Department of Revenue
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How to Place Before Voters?
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
School boards pass a resolution

When School Boards representing more than
50% of the resident student enrollment in the
county adopt resolutions, the Regional
Superintendent must certify the question to
the County clerk

County Clerk will place on the ballot at the
next regularly scheduled election
Required Language on the Ballot
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Ballot Language (cannot change):
Shall a retailer’s occupation tax and a service
occupation tax (commonly referred to as a
“Sales Tax”) be imposed in (name of county)
at a rate of (insert rate) to be used
exclusively for school facility purposes?
Passing the Vote and Receipt of Revenues

Simple majority of votes cast needed to pass

After approval by the voters, the tax will be imposed

The ordinance and the election results must
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–
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Be certified by the County Clerk
Filed with the Illinois Department of Revenue

Money is received monthly beginning approximately
four months after the tax goes into effect

The money follows the student
Distribution of Sales Tax
Distributed by R.O.E. on a per
resident-pupil basis
2% withheld by IL Dept. of Revenue
- Same as all sales taxes
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The money follows the student
Timeline is Critical
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Election Date
Mar. 18, 2014
Nov. 4, 2014
Apr. 7, 2015
Pass Resolution (School Districts)
Dec. 30, 2013
Aug. 18, 2014
Jan. 20, 2015
Certify the Resolution
(County Clerk)
No later than Jan.
9, 2014
No later than
Aug. 27, 2014
No later than
Jan. 29, 2015
Election
Mar. 18, 2014
Nov. 4, 2014
Apr. 7, 2015
File with IL Dept. of Rev. to
Enact Tax
No later than
October, 2014
No later than
April,1, 2015
No later than
October,1, 2015
Sales Tax Goes into Effect
Jan.1, 2015
July 1, 2015
Jan. 1, 2016
Regional Superintendent Receive
Funds from State
Approximately 90
Days after Jan.1,
2015
Approximately 90
Days after July 1,
2015
Approximately
90 Days after
Jan. 1, 2016
District Receives New Sales
Tax Revenues
April 2015
October 2015
April 2015
Keys to Success
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Time is your most important asset – don’t waste it
Unified support (as much as possible) for CSFT from
all districts
ALL DISTRICTS must communicate the message
about what CSFT is and how it would benefit their
district
Someone has to take ownership and lead the effort
Develop county-wide leadership and communication
Putting the question on the ballot is not enough –
must EDUCATE voters – A LOT
It’s Different Because…
Communication challenges
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Unfamiliar type of school funding
Need to keep referendum from being
indentified with a single district
Targeting of messages more important
It’s Different Because…
Organization, Strategy are more
complicated
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Politics more involved
Coordinating multiple districts a challenge
It’s Different Because…
Opposition more likely
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Sales tax referenda often attract organized
opposition
County/cities/districts might oppose
referendum
Fundraising more challenging
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Especially if revenue to be used only for
property tax relief
It’s Like a District Referendum…
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Time is your most important asset – don’t
waste it
Build foundation from community
engagement – win before you begin
Develop community-wide leadership
Unity among school districts/key
stakeholders
Someone has to take ownership
It’s Like a District Referendum…
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Strong campaign leadership/doers not
thinkers
District leadership commitment to helping
with fundraising, grassroots effort and
informational communications
Discipline – everyone works the plan
Successful fundraising
Pitfalls to Avoid
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Opposition from a school district
Lack of cooperation from districts
No cat herder
Not adhering to message
Engaging opposition
Inability to raise money
No plan
Deviation from the plan
Next Steps
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
Start talking NOW with community regarding
facility needs – seek community input
Identify inter-district communication coordinator
(“cat herder”)
Community support group organizes
Develop purpose statements and pass
resolutions
Do not assume work ends after resolutions are
passed
Talk about “what and why” CSFT 24/7
Introductory Video
Below is a link to a 10 minute video that gives a nontechnical introduction to the basics of the County
School Facilities Sales Tax and how it has been
used across the State.
http://youtu.be/BLN9yacb4dE
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Key Resources
Lynda K. Given
Kyle Harding
Chapman and Cutler
111 West Monroe Street
Chicago, IL 60603-4080
Phone: 312/845-3000
given@chapman.com
harding@chapman.com
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Jane Quinlan
Regional Superintendent – Champaign County
Regional Office of Education #9
200 South Fredrick Street
Rantoul, IL 61866
Phone: 217/893-3219
jquinlan@roe9.k12.il.us
Gloria Davis
Jon Kilgore
Superintendent
Decatur School District 61
101 W. Cerro Gordo Street
Decatur, IL 62523
217/424-3010
gjdavis@dps61.org
Superintendent
Pontiac Twp HSD #90
1100 Indiana Ave.
Pontiac, IL 61764
815/842-2358
kilgorej@pontiac.k12.il.us
Jon Kilgore
Gloria Crook
Superintendent
Pontiac THSD #90
1100 East Indiana Ave.
Lincoln, IL 61764
Phone: 815/844-6113
kilgorej@pontiac.k12.il.us
Revenue Tax Specialist
Department of Revenue
101 West Jefferson Street
Springfield, IL 62702
217/785-5970
Important Disclosures and Certifications
Stifel, Nicolaus & Company, Incorporated (“Stifel”) is providing information for discussion purposes and is declaring that it has done so
within the regulatory framework of MSRB Rule G-23 as an underwriter (by definition also including the role of placement agent) and
not financial advisor, as defined therein, to the issuer for this proposed issuance of municipal securities. The primary role of Stifel, as
an underwriter, is to purchase securities for resale to investors in an arm’s- length commercial transaction. Serving in the role of
underwriter Stifel has financial and other interests that differ from those of the issuer. The issuer should consult with its own financial
and/or municipal, legal, accounting, tax and other advisors, as applicable, to the extent it deems appropriate.
These materials have been prepared by Stifel, Nicolaus & Company, Incorporated (“Stifel”) for the client or potential client to whom
such materials are directly addressed and delivered (the “Issuer”) for discussion purposes only. All terms and conditions are subject
to further discussion and negotiation. Stifel does not express any view as to whether financing options presented in these materials
are achievable or will be available at the time of any contemplated transaction. These materials do not constitute an offer or
solicitation to sell or purchase any securities and are not a commitment by Stifel to provide or arrange any financing for any transaction
or to purchase any security in connection therewith. Where indicated, this presentation may contain information derived from sources
other than Stifel. While we believe such information to be accurate and complete, Stifel does not guarantee the accuracy of this
information. This material is based on information currently available to Stifel or its sources and are subject to change without notice.
Stifel does not provide accounting, tax or legal advice; however, you should be aware that any proposed indicative transaction could
have accounting, tax, legal or other implications that should be discussed with your advisors and /or counsel.
Stifel’s Public Finance Department has prepared the attached materials to provide you with general information (as that term is defined
in the SEC’s Municipal Advisor Rule) and we are not providing you with any advice or making any recommendation concerning the
structure, timing or terms of any issuance of municipal securities or municipal financial products. To the extent that we provide any
alternatives, options, calculations or examples in the attached information, we are not intending to express any view that you could
achieve those results in any municipal securities transaction and those alternatives, options, calculations or examples do not constitute
a recommendation that you should effect any municipal securities transaction. Stifel does not act as your municipal advisor.
Stifel is providing information for discussion purposes and is declaring that it has done so within the regulatory framework of MSRB
Rule G-23 as an underwriter (by definition also including the role of placement agent) and not as a financial advisor, as defined
therein, to the issuer for this proposed issuance of municipal securities. The primary role of Stifel, as an underwriter, is to purchase
securities for resale to investors in an arm’s- length commercial transaction. Serving in the role of underwriter Stifel has financial and
other interests that differ from those of the issuer. The issuer should consult with its own financial and/or municipal, legal, accounting,
tax and other advisors, as applicable, to the extent it deems appropriate.
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Additional information is available upon request
Stifel, Nicolaus & Company, Inc., 501 N. Broadway, St. Louis, MO 63102
This presentation contains proprietary
information compiled by Stifel Nicolaus.
Reproductions can be made
with permission from Stifel Nicolaus.
Please call Tom Crabtree
for permission at
1(800) 230 5151
Extension 8457
THANKS
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