As reported by the Chicago Tribune, persistent technology upgrade issues have kept Cook County from distributing millions in property tax revenue to school districts and other taxing bodies. Earlier this year, the technology issues prevented certification of property tax assessed values. As a result, second installment property tax bills, which by statute are supposed to be mailed by June 30, were not mailed until November 2025. Then, in late 2025, county officials realized they had been working with outdated files to calculate property tax distributions. The Cook County Treasurer’s office reportedly took emergency steps to send approximately $2.3 billion of the more than $8 billion in property tax distributions to taxing bodies. But the full amounts are still forthcoming. And county officials have not said when the delays will end.
Due to the delays, school districts are utilizing short-term financing options to obtain revenue. As discussed in the Chicago Tribune article, one district is issuing tax anticipation warrants that provide additional cash inflow by “anticipating” (or drawing against) the delayed property taxes. The warrants are payable when the district receives the property tax revenue. Another District is tapping into its working cash fund. The working cash fund allows a school district to keep sufficient money on hand for ordinary and necessary corporate expenditures. The district may borrow against the working cash fund on a short-term basis or make permanent transfers on a limited basis to make money available for the district’s general funds that may be in need.
Additionally, school boards can establish a line of credit with a bank or other financial institution payable when the district receives the property tax distribution. School boards also can anticipate state aid payments through lines of credit or state aid anticipation certificates and obtain advances of other streams of revenue through personal property replacement tax notes, revenue anticipation notes, or teacher orders.
Even though short-term financing options are available to weather the delay, school boards must comply with specific statutory procedures to utilize such financing options. Accordingly, it is advisable to consult with your legal counsel before utilizing such financing options.
Please contact Tony Senagore or any other attorney in our Corporate Practice Group if your district is considering utilizing short-term financing to weather the unexpected property tax distribution delays.
Source: Chicago Tribune
