Nobody wants to provide property tax relief more than we do. Unfortunately, it looks less and less likely we’re going to have the means to do so despite the numerous politicians that are promising it. Here are some numbers to analyze. Please contact me with ideas, suggestions, concerns, etc.
A LOOK AT THE 2014-15 FISCAL YEAR
This current year of 2014-15, York Public Schools finally is able to function like a “normal” school district. By that, I mean we are able to make a curriculum update without delaying it like we’ve had to do in years past, upgrade some outdated technology, purchase some much needed vehicles to replace two different 18+ year old units; while also adding a little bit to a cash reserve that sits at only 20% of its desired level. In fact, as this fiscal year began, we had less than $690,000 in our general fund opening balance; when it is recommended that a district our size have $3.5 million.
• Our 2014-15 general fund property tax request is $3,316,738 more than it was in 2008-09; for an increase of 49.2% as it currently sits at $10,049,494
• Our 2014-15 state aid is $2,008,442; which is $1,706,367 less than it was in 2008-09; for a decrease of 45.9%
• Our projected total revenue for 2014-15 is $15,400,000; which is $1,640,478 more than 2008-09; for an increase of 11.9% over six years but still less than 2% average growth annually
• Our 2014-15 valuation is $987,905,058; which is $359,064,412 higher than it was in 2008-09; for an increase of 57%
• Our projected total spending for 2014-15 is $15,200,000; which is $1,386,337 more than 2008-09; for an increase of 10% over six years but still just an average annual growth of just 1.6%.
o Much of this spending increase has been on expanding our birth-to-five programming as well as adding sections of Kindergarten, 1st, and 2nd grade to keep our growing class sizes effective
PREVIEWING THE 2015-16 FISCAL YEAR
Our new 2015-16 fiscal year will begin on September 1st. This is the time of year we begin to update projections and plan ahead. We just found out that our state aid is projected to go down $445,000. How are we going to provide property tax relief? If we increase our general fund tax request to only recover the $445,000 we’re losing from state aid, that’s already a 4.4% increase over what we’re asking for in property taxes this year. This would keep our projected revenue for next year the same as it is this year at $15,400,000.
We can try to flat-line our spending (again) by delaying another round of curriculum adoptions, not updating our aging vehicle fleet, getting by with the technology we have, and not adding to our cash reserve. But then what? Do we need to look at cutting staff again? York High School already has 6.5 fewer teachers than it had 10 years ago. York Middle School has 2.5 fewer teachers. We’re practically re-writing the book on doing more with less even though the number of students with special needs that we serve is at an all-time high. Our total enrollment has increased 7% over the past five years as well. How can we provide property tax relief with flat-lined or declining total revenue?
WHY ARE PROPERTY TAXES WITHIN YPS HIGHER THAN NEIGHBORING DISTRICTS?
I’ve been asked a few times over the past year why farm ground within the boundaries of York Public Schools costs more than it does in other school districts. It all comes down to money generated per student. Each school district is unique. The examples I’m comparing to York are Franklin and West Point because I’ve worked for both of those systems and have respect for their communities. Farmers within YPS boundaries will pay much more for their ground than farmers in Franklin and West Point with lower levies but those lower levy districts will still generate much more money per student than York ever will. There are numerous school districts in Nebraska with levies lower than West Point and higher valuations.
• York is able to generate $9,977,790 with their $1.01 levy
o This comes to $7,183 of property tax revenue per student
• York’s levy is maxed out at $1.05 when you factor in our building fund tax request as well
• Franklin is able to generate $3,870,585 with their $0.95 levy
o This comes to $12,607 of property tax revenue per student
• West Point is able to generate $8,809,910 with their $0.85 levy
o This comes to $10,665 of property tax revenue per student
In 2013-14, York’s cost per pupil spending was $11,649 per student. Franklin spent $15,845 per student. West Point spent $12,969 per student. This is just a simple comparison of York and two other high quality school districts in our state using actual, updated data.
LITTLE KNOWN FACTS
• 65% of Nebraska’s school districts don’t receive any equalization aid from the state
• Local Property Taxes make up 48.2% of Nebraska public school districts’ revenue
o The national average is 29%
o In 2013-14, local property taxes accounted for 60.5% of York’s revenue
• State Aid makes up 31.6% of Nebraska public school districts’ revenue
o The national average is 45.5%
o In 2013-14, state aid accounted for just 10% of York’s revenue
• Simply put, this just shows once again the over-reliance Nebraska schools have on local property taxes
WHAT ABOUT DE-VALUING AGRICULTURE LAND TO 65% - WON’T THAT BE A GOOD THING?
Taxing agricultural land at only 65% of its full market value would likely lead to higher property taxes or service cuts for the vast majority of Nebraskans. Reductions to agricultural land valuations lead to significant revenue losses at the local level and for K-12 education, which would not be made up by increases in state aid.
• According to Open Sky, K-12 schools would lose approximately $91 million/year.
• The reduction in local resources would trigger an increase in state aid of only $25 million – resulting in a net loss to K-12 education of $66 million/year.
Agricultural land owners who live near urban areas could see significant property tax reductions, as property taxes could be passed on to nearby commercial and residential properties. In more rural areas, however, where property taxes couldn’t be passed on, property tax levies would either need to increase to fill the revenue shortfall or school budgets would need to be cut; limiting the services they can provide.
CLOSING
We’re just trying to get the facts out to our patrons. We don’t see how the much talked about “property tax relief” is going to come to York, Nebraska or lots of other communities either. We have a system that is in need of reform. We need more state funding for public education.
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