HERRIN — Tax payers in Herrin could see an increase in their property taxes later this year after a lawyer in Marion successfully sued the school district over how the district was using money from the Williamson County Sales Tax.
The Herrin School District must now pay back more than $2 million to itself with taxpayers possibly footing the bill.
Superintendent Terry Ryker says there are two options the school district is considering, raising property taxes or taking the money from a surplus account the district has which could lead to cuts.
Ryker explains that the Williamson County School Facility Tax Law gives money to school districts to build new facilities without making them raise taxes.
He says Herrin School District uses that tax to pay back some of the bonds used to build the high school in the early 2000’s.
"We weren’t the only school district in the state of Illinois that has done this," Ryker said. "There are other school districts that have done this but we seem to be the only ones that are caught in this."
Voters in Williamson County decided back in February of 2008 that they would be the first county in the state to pass this tax.
"The citizens of Herrin knew that if this was passed, the bond payments were going to be abated and taxes were going to be lowered," Ryker said.
The tax was a 1 percent increase on goods and the money would be separated into the four school districts.
Ryker said the first year Herrin received over a million dollars.
"It’s suppose to go for school facilities and school facilities updates, major renovation projects, new building projects, financing and architect fees," Ryker said.
Less than two years after the tax passed, the school district was handed a lawsuit from a lawyer in Marion, Ron Osman.
The court documents state the district was using the tax money incorrectly.
Ryker said during his interview that other school districts were doing the same thing.
During that time, there was a different school board and Dr. Mark Collins was the superintendent.
Ryker said the school’s legal council told them it was okay.
"At the time they thought they were doing something completely legal," Ryker said.
One year after the lawsuit started, the Illinois General Assembly changed the law and made it clear schools could in fact use the money for financing.
"They, I don’t want to say changed the laws but, defined it a little different to specifically say you could do what the Herrin School District did," Ryker said.
Last month, the judge ruled that Osman was correct, saying the school district should not have used the money to pay back the bonds in 2009 and 2010.
Herrin now has to find $2.5 million to pay back the money to their own account.
"We would be paying ourselves," Ryker said. "The thing is, that money is going to be going back to the school district but we are going to have to raise another $2.5 million."
Ryker said the school board has to make a decision by the end of the calendar year.
"It’s not that easy when you have to look at someone and tell them I’m going to raise your taxes because I really don’t want to do that," Ryker said.
News 3 called Osman on Thursday to ask if he had a statement for this story, he said he had no comment.
Ryker said if the board decides to increase property taxes, for a home worth $100,000, the tax would jump by about $70 a year.
See the full lawsuit below: