An error related to the state of Illinois’ distribution of personal property taxes on businesses could cost Chicago Public Schools $23.5 million.
The Illinois Department of Revenue announced the error Tuesday. All told, the state misallocated $168 million to local governments since 2014.
A release from the agency claims “the miscalculation occurred under the prior administration."
The agency is blaming a paperwork error for the misallocation. The error was noticed during the implementation of a new ledger system.
“We are certainly sensitive to the impact recouping these funds will have on some of our taxing districts,” Department of Revenue Director Connie Beard said in a statement. “We will be working with the impacted taxing districts to establish a plan to recapture these funds over an extended period of time.”
City Hall officials are still assessing the miscalculation.
“Currently, the city has no information regarding the State’s claim of overpayment," City Hall spokeswoman Molly Poppe said in a statement. “We are working with the other impacted Chicago government agencies, along with reaching out to the State to obtain further information."
Local
The mistake involves the misallocation of personal property replacement taxes, which are collected by the state and passed on to local governments.
The taxes serve as a replacement for money governments lost after the 1970 Illinois Constitution did away with their ability to levy personal property taxes on corporations, partnerships and other business entities.
Roughly 6,500 taxing districts in Illinois were affected by the error. Overpayments for most of those districts are for $10,000 or less, although 10 taxing districts, including Chicago, were overpaid more than $1 million.
The city was overpaid by $19.4 million, while Cook County received $6.5 million more than it should have.
In addition to this, the Chicago Park District was overpaid by $5.6 million and the Metropolitan Water Reclamation District received $5 million more than it should have.
The state distributed $1.37 billion in taxes to local governments in 2014 and $1.43 billion in 2015.
