Lawrence school board members Monday night agreed to move forward with about a 0.25 mill levy decrease for the 2007-2008 budget.

The recommendation from administrators marked a sharp turnaround from the past few weeks, when board members were considering an increase of more than 3 mills after increases of more than 5 mills each of the last two years.

“I think we have an opportunity to be very fiscally responsible in a time when property values and expenses for families are increasing,” board member Marlene Merrill said.

Superintendent Randy Weseman said earlier Monday the district has been able to keep costs for its ongoing, bond-funded construction projects – including building a new South Junior High School – at or under budget. The savings allowed the school district to decrease its bond and interest levy about 1.5 mills and only slightly increase the capital outlay levy, as opposed to the original projection of a more than 0.5 mill increase.

“I think this is an opportunity for us to do this now, to demonstrate for the community that we do practice sound fiscal management,” Weseman said. “We’ve been able to produce some reserves through good management of the bond projects.”

The action on the bond and interest and capital outlay levies would offset a recommended increase to the local option budget of about 1.5 mills. The local option budget must remain at 30 percent of the district’s general fund for the district to be eligible for about $1.3 million in the state’s cost-of-living fund.

If these budget projections become official, administrators said the owner of a $150,000 home in the Lawrence district would see a savings of a few dollars. Under the earlier proposed property tax increase, that same owner would have seen an annual increase of about $50 and total annual taxes to the district of about $1,000, according to district projections. A mill is $1 in taxes for every $1,000 of assessed valuation.

Weseman and Kathy Johnson, the district’s division director of finance, said bond projects that are coming in within budget have released cash reserves in the bond and interest fund.

After hearing a budget presentation, board members voted 6-0 – with board member Scott Morgan absent – to reduce the capital outlay fund to 7.5 mills from an earlier recommendation of 8 mills.

The board will vote whether to adopt the budget during an Aug. 13 public hearing.

Also at the meeting, board members voted to join the city and county in approving a revitalization plan for a development to add houses, offices and commercial space near Eighth and Pennsylvania streets by developer Bo Harris.

Board members also approved a mediation settlement reached with Artistic Floorcoverings Inc. for the company to re-install carpet in some hallways at Southwest and West junior high schools. The district had withheld about $186,150 in contract funds during a dispute since fall 2005 about the carpet’s quality.

The cost of the new carpet will be paid out of the contract-retained funds, and the remaining balance will be paid to Artistic after a satisfactory installation, according to a statement from the district.