Park District Issues Bonds Every Year


A few weeks ago, DeKalb Park District Director Cindy Capek was quoted in the paper as saying DPD issues bonds every year. I mentally filed this because it was news to me. (Also, I’ve been meaning to keep a closer eye on any local public body whose board thinks it’s OK to have an admitted thief as president.) Anyhoo, I finally got around to asking about it.

Here’s the scoop. DPD makes its usual, annual property tax levy. It also takes advantage of a provision of Illinois park district law to collect a debt service levy by issuing bonds. Assistant Director Lisa Small responded to my e-mailed questions thusly:

1) The District’s issuance of limited bonds is authorized under Section 6-2 of the Park District Code, as supplemented by Section 15.01 of the Local Government Debt Reform Act of the State of Illinois.

2) The issuance of limited bonds to pay annual debt service payments on outstanding alternate revenue bonds is a common plan of financing in Illinois. It is also common for Park Districts to issue additional amounts for capital project needs on a yearly basis.

3) The amount of limited bonds issued by the District is structured to (i) provide the source of payment for the District’s outstanding General Obligation Refunding Park Bonds (Alternate Revenue Source), Series 2005,* due on February 1, 2011, and (ii) address the District’s routine capital project needs, such as park development, facility improvements, paving pathways, purchasing maintenance equipment.

The debt service levy is not chopped liver. DPD’s FY2011 Budget and Appropriations Ordinance estimate of tax monies it would receive was $3,516,750, while the Series 2010 bond issue itself was $1,097,820.

You probably already know that the regular levies have been limited by the Property Tax Extension Limitation Law (tax cap) rules passed in 1999. PTEL also froze the debt levies at 2000 amounts, in DPD’s case at $1,101,535 — but not for much longer. According to Small:

Public Act 96-501 amends the definition for the “debt service extension base” under Section 18-185 of the Property Tax Code. Under this new act, beginning with the 2009 levy year, the dseb will increase each year the same as the extension limitation, which is the lesser of 5% or the percentage increase in the CPI. The Park District’s 2010 dseb is $1,132,407.72.

DPD’s FY2011 budget (which ends February 28, 2011) is about $6.5 million and its debt service appropriation nearly $1.5 million.

*Series 2005 was issued for construction of the Sports & Rec Center and will be retired in 2019.