Politics & Government

No Agreement for Impact Payments to Kaneland Schools

The Kaneland School District had hoped to sign a five-year deal for impact payments with the seven communities it serves. However, a consensus could not be reached, so those communities will calculate those payments on their own.

Last year, the Kaneland School District made a pitch to the seven communities it serves: sign a new five-year intergovernmental agreement to cover impact fees and other costs.

But as of Dec. 31, when the previous agreement expired, a new one had not been signed to take its place. And as Superintendent Jeff Schuler explained to Montgomery trustees this week, there won’t be one for the foreseeable future.

The proposed agreement would have put Kaneland’s communities—, Elburn, Virgil, Sugar Grove, Maple Park, Kaneville and Cortland—on the same page regarding impact payments and land/cash agreements. These payments are made to school districts when properties are annexed, and new homes are built.

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Impact payments are intended to offset the cost of educating an expected number of children in each new home, and are paid when the permit for a new house is issued, Schuler said. Governments charge developers impact fees—which are also used to pay for new infrastructure, like water and sewer lines, needed for new homes—and they pay the district out of this money.

Land/cash agreements are one-time set-asides for the school district when a government annexes land into that district. This payment can come in the form of land, on which the district may build a school, or an equivalent amount of cash. Developers ordinarily pass both types of payments on to homebuyers.

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These payments to the district would only occur if a new subdivision project were annexed into the village. It would not impact current subdivisions in the Kaneland district, like Foxmoor in Montgomery. All of this money, Schuler said, goes into Kaneland’s capital improvement fund, to pay for the construction of new schools and new district buildings.

The proposed agreement would have changed the way some Kaneland communities calculated those payments. And in the end, Schuler said, a consensus could not be reached. The village of Sugar Grove, he said, had the most significant problem with the deal—Schuler said leaders there wanted the freedom to determine payments on a case-by-case basis.

That’s the way the payments will now work in all seven communities, Schuler said—municipalities will be able to decide how much to charge developers and give to the district. That, he said, makes things less certain for the district, and will mean that they are more involved in annexation agreements.

The Kaneland communities, however, “have always advocated for the needs of the district,” Schuler said, and he expects that will continue.

Jeff Zoephel, Montgomery’s finance director, said the village will continue to pay the Kaneland district impact fees and land/cash payments based on a table the district has provided. Unless the district gives them a different table, he said, there should be no change.

Schuler said the full impact of working without an intergovernmental agreement would not be known until development picks back up, and annexation agreements are signed. But the agreement would have kept all seven municipalities calculating these payments the same way, Schuler said.

“The concern always was, in high-growth periods, the IGA leveled the playing field, and would keep developers from shopping between communities,” he said.


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