If school district officials were just trying to scare local taxpayers with a preliminary proposal to increase the district’s property tax levy by 5 to 6 mills, they accomplished their goal.
Now, they and school board members should go to work on a proposal that’s a little more reasonable in the current economic climate.
District officials are pointing to reductions in property valuations as the culprit for higher tax levies, but that may be only a small portion of the problem. County officials haven’t completed their valuation calculations for the school district, but the county’s overall valuation actually is up slightly, by less than 0.5 percent.
The district budget calculated with a 1 percent decrease in property valuation calls for a 5.3-mill tax increase. That includes a 2.3-mill increase for the local option budget. The district has the authority to levy a LOB tax that is equal to 31 percent of its general fund. The combination of lower valuation and a higher general fund budget makes it necessary to add 2.3 mills to maintain the 31 percent level.
Most taxpayers probably can support that increase because that money goes straight into the fund that pays teachers and supports school programs. It’s the same fund that was so decimated by state funding cuts this year.
Increases of 2 mills for the district’s capital outlay fund and 0.9 of a mill in the district bond and interest fund are a little harder to stomach. The increase in the bond and interest fund is needed to cover payments on the 2005 bond issue that funded secondary school and technology improvements.
Money from that bond issue had been left unspent until the school board decided last year to use it to build new football stadiums and playing fields at the two high schools. If the leftover money hadn’t been spent on the fields, could it, or at least the interest it earned, have been used to cover the bond payments?
Additional money for the athletic projects also came from the capital outlay fund. If school officials now say they need 2 additional mills to shore up the capital outlay fund, taxpayers have reason to wonder about the money that was spent on the athletic fields. At the very least, that money was diverted from other needed capital projects in the district, projects that might have been more important than amenities at the athletic fields.
The district has the authority to levy up to 8 mills for its capital outlay fund. The budget requiring a 5.3-mill increase uses the entire 8 mills, but board members already are saying they may modify that figure, perhaps to be more in line with the 6 mills that were levied for the current school year.
The city’s preliminary budget called for no property tax increase, but the city has other ways of raising money — sales tax, utility fees, etc. Property tax is the only way the school district can increase its revenue. Given the funding cuts inflicted by the state this year, some additional local support for the school district is justified.
However, board members should do what they can to minimize the increase. Shoring up the general fund is the top priority. Covering payments on the bond issue is necessary. Some capital outlay projects may have to wait.