Kansas legislators were proud last session to announce they had passed a school finance bill that included no tax increases for next year. What they consistently neglected to mention was that their plan depended on school districts across the state approving increases in their local property tax levies.
Because they had to wait until last week to learn whether the Kansas Supreme Court would accept the finance plan, school districts just now are trying to figure out how much money they will receive and what additional levies they should approve.
Rather than taking full responsibility for funding their school finance plan, legislators have left the dirty work to local school boards by giving them additional authority to raise revenue through local levies, known as local option budgets or LOBs. That leaves some tough decisions for school boards, which have only one way to raise revenue: property taxes.
The Lawrence district expects to get about $2.8 million in additional state aid this year, but that money is earmarked mostly for special education and at-risk programs. The district now can use LOBs to fund up to 30 percent of its general fund, up from 27 percent. Taking full advantage of that increase would raise the local property tax levy by 1.7 mills. A mill is $1 for every $1,000 of property valuation.
In addition, because the average home valuation in the Lawrence district exceeds the state average by more than 25 percent, the school board also can use LOBs to raise an additional 4.37 percent of its general fund budget. The levy originally was tied to home valuations and restricted to use for teachers salaries on the theory that communities with a higher cost of living need to pay teachers more. However, the bill later was changed to allow the money to be used for other budget needs. Nonetheless, there's special irony in forcing communities where housing already is expensive to tack on additional property taxes, thereby driving the cost of housing up even further.
If the Lawrence district used all of its taxing authority, including a proposed 2-mill increase in the district's capital outlay fund for equipment and building projects, the local tax levy would rise by more than 8 mills. So much for no new taxes.
Higher teacher salaries are important, as is funding to maintain district property (a fact that has been highlighted by the city's current need to play catch-up on infrastructure projects.) Using all the available taxing authority probably wouldn't be a popular move, however, and some Lawrence school board members have indicated they plan to take a more moderate course. They don't have a lot of time to think it over, however, because they need to approve a budget for publication tonight in order to meet their budget deadlines.
On Tuesday, local school officials still were trying to figure out how different levies could be used and other details that affect the budget, but, as Harry Truman said, the buck stops here, with the local school board. That includes taking the heat from local residents about any property tax increases they approve to support the finance plan that the Legislature, the governor and the courts have thrown in their laps.