Lawrence school officials are leaning toward a property tax increase.

“I think it’s very likely – that’s my personal opinion,” said Board President Sue Morgan, referring to a proposal to push the district’s local option budget to 30 percent of its general fund.

The proposal would add 1.728 mills to the district’s property tax levy, raising an additional $1.7 million. A mill is $1 for every $1,000 of assessed valuation.

Before last week, local option budgets were capped at 27 percent.

The increase was made possible by the Kansas Supreme Court’s decision to dismiss the 1999 lawsuit that challenged the state’s school finance formula.

“Given what we’re faced with and what the state came through with, this is the authority we’ve been given,” Morgan said shortly after the board’s regular meeting Monday.

“Property tax is the only source for revenue we’ve been given,” she said, noting the district is under intense pressure to raise teacher salaries and remain competitive.

The board is expected to discuss the district’s budget during a special meeting at 7 p.m. Wednesday at the district service center, 110 McDonald Drive.

Morgan warned that while the district expects an additional $2.8 million in state aid, most of the increase has to be spent on special education and at-risk programs. It cannot, for example, be used to raise teacher salaries across the board.

The board also is considering adding 2 mills to the district’s 6-mill capital outlay fund.

“The capital outlay fund is for equipment and (building) repairs,” Supt. Randy Weseman said.

A third proposal calls for taking advantage of a new cost-of-living provision in the state aid formula.

The provision is limited to school districts where the average home valuation exceeds the state average by more than 25 percent.

Across Kansas, 18 school districts meet the criterion: De Soto, Tonganoxie, Lansing, Piper, Bonner Springs, Blue Valley, Spring Hill, Gardner, Olathe, Maize, Paola, Manhattan, Andover, Louisburg, Auburn-Washburn, Basehor-Linwood, Shawnee Mission and Lawrence.

“The average value for a house in Lawrence is $216,338,” said Kathy Johnson, budget director for the Lawrence school district. “Statewide, it’s $118,581. So we’re there.”

The provision allows these so-called “Sweet 18” districts to tap local property taxes for up to an additional 5 percent – exactly how much more is based on housing costs within each district.

In Lawrence, for example, the increase would be limited to 4.37 percent.

To be eligible for the cost-of-living provision, a district first must maximize its local option budget.

Enacted in 2005, the provision was blocked by the Kansas Supreme Court because of concerns that it widened spending inequities between low- and high-valuation districts.

But when the court dismissed the school finance lawsuit Friday, it lifted its stay without comment.

Under the new law, districts that seek the additional aid are expected to set up “teacher salary enhancement funds.” The funds are designed to ensure the revenues actually are spent on teacher salaries.

“We’ve continued to fall behind districts we compete with – namely Blue Valley, Olathe, Shawnee Mission and others to the north and east of us,” Morgan said.

Morgan said she doubted the board would go for the full 4.37 percent.

“I’m not optimistic about maxing it out,” she said. “We might go with a lesser amount; I don’t know.”

As of last week, 71 of the state’s 300 school districts had maximized their local option budgets. Statewide, the average local option budget is 24 percent.