ROXANA, Ill. (CN) - An Illinois school district must refund $8.6 million in property taxes and interest to WRB Refining, which operates an oil refinery in Wood River.
WRB sued the Roxana School District in 2013, claiming the district grossly inflated its tax levies in 2011. The refund is part of a settlement to that lawsuit. WRB also challenged taxes for 2012, but that is still pending.
Roxana, pop. 1,600, is suburb across the river from St. Louis.
Madison County State's Attorney Tom Gibbons negotiated the settlement on behalf of the county; it has been approved by a judge.
"The settlement we have reached goes a long way to reining in the excessive spending of this taxing district, and sends a clear message that extraordinary increases in property taxes put upon taxpayers will not be tolerated," Gibbons said in statement. "I was able to negotiate a settlement with WRB that allows (the school district) to keep some of the money that it excessively levied for in 2011."
According to Gibbons, WRB's property bill from the school district increased from $3.53 million in 2010 to $14.46 million in 2011. The school district increased WRB's tax bill by 10 percent in 2012 to $15.9 million.
"No single taxpayer should see their tax bill more than quadruple from one year to the next, especially when a district has demonstrated the ability to make ends meet," Gibbons said in the statement.
Roxana school district officials told the St. Louis Post-Dispatch they are likely to appeal.
In a letter to district parents this month, Roxana School Superintendent Debra Kreutztrager said a $3.8 billion expansion had increased the refinery's assessed value, which increased the refinery's taxes. She said the district had reduced its tax rate. She also accused Gibbons of agreeing to a settlement without sufficient input from the school district.
Kreutztrager wrote that the district would be forced to cut 30 to 40 teaching positions, eliminate one-third of other staff, increase class sizes, reduce educational programs and increase taxes if it is forced to pay the refund, according to the St. Louis Post-Dispatch.
But Gibbons told the newspaper that the Roxana School District hasn't shown any evidence of financial hardship and that the settlement is fair. According to the District Attorney's Office, the Roxana School District would keep $6 million from WRB for 2011 - a 70 percent increase from the year before.
"A nearly 70 percent raise from one year to the next is still an extraordinary bounty for a school district - especially in the difficult economic times everyone has faced over the last several years," Gibbons said.
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