Note: If I misstated some facts here, please notify me directly at [email protected] or submit a comment and I will correct the information if credible.
July 28, 2009 - Tavares, FL - Last night the Lake County School Board voted unofficially 4 to 1 to hike property taxes by .25 mills to pay for capital spending and maintenance programs. This was NOT a final vote, but a preliminary vote, and the formal, final vote will be at a Board meeting on Sept. 8th.
The issue, covered by newspaper articles at both the Daily Commercial and the Orlando Sentinel, was that the State legislature dumped on all School Districts by changing the allocations for a "2 mill" tax normally received by all Florida School Districts, but restricted to capital and maintenance spending. Thus, it can't be used for teachers or programs. A "mill" represents 1% of property values, thus a 2 mill tax would be $2 for every $100 in property values (residential or business). Or, it is $20 per $100,000 in property values subject to tax. Thus if you have a house with a taxable property value of $300,000, your annual tax of 2 mills would be $60. This tax is not all the taxes received by the School District, but is the source of the issue.
Basically, the legislation took away .25 in the past, and now is taking another .25 mill (1/4 of a mill) of the 2 mill tax to keep it for other state uses, reducing the existing tax to 1.5 mills, while the state still collects and keeps the other .5 mill. However, the legislators said the School Districts could vote to increase their portion of the property tax for capital and maintenance by up to .25 mills. Thus, it forces the school district to ask for tax increases to achieve parity with prior budgets, while the legislators didn't have to vote on a tax increase. So, the first issue is to ask your Florida legislators why they allowed such a scheme to take place, then vote them out of office (I don't like schemes like this).
So, the vote last night was to increase the "local content" of the tax to replace the hijacked .25 mills. And, the tax is slated to sunset in two years.
The meeting was stacked with pro-education people and teachers who launched a clearly coordinated effort to focus on the talking point issue of increasing the tax to fix leaky roofs and to maintain maintenance on buildings. These issues were reiterated by the four School District Board members who voted for the tax.
Larry Metz was the sole negative vote, saying that the District had both a 4% reserve and another $9-million reserve set aside that could be used to pay for the expected expenses. Additionally, Metz clarified the muddled "maintenance" of roofs issue by saying there were no roofs currently leaking, and all the emotional talk was based upon speculation that the roofs would leak in the next two years.
I spent my three minutes asking why the Board hasn't talked how staff and teacher wages were most likely increased significantly over the local GDP or economic situations over the past 10 years, and now that income sources are declining, the wages should be reduced just like they were increased in the good years. There has been no information that shows the percent of wages of total budget vs capital and maintenance over the last 10 years, and how passing the tax is really a subsidy of high wages, when they should be reducing wages to keep them in the same percent of total budget as they were 5-10 years ago.
Speaking of "pots". The School District uses fund accounting, which means that revenues from certain sources are restricted to certain expenditures, thus if you look at the budget, you will find that it is broken up into separate fund groups. An example is lunch programs, which come from Federal funds, so their funding goes through a food fund. Or, the above mentioned "2 mill" (now down to 1.5 mills) capital and maintenance fund, which is restricted to spending only on those areas. The Board wisely doesn't try to turn the public into fund accountants (a fate worse than death to this auditor), so they talk in term of "pots", with funds from different sources going into pots (or accounts) that can only be spent on restricted uses. So, the question is whether the funds in the "wage" pot can be spent on maintenance. Cindy Barrow has said this can't be done, and we may be meeting later to evaluate the issue. If I agree, I will post that RIGHT here!
So, as it stands now, the Board has unofficially voted 4 to 1 to increase taxes by .25 mills to maintain their former levels of capital and maintenance funds. There was lots of emotion from speakers on both sides of the issues at the meeting, and Channel 13 was there, plus both newspapers had their assigned reporters there.
My recommendations are:
- Call and write the culprits in this fiasco, who are your State legislators. Complain to them. Don't let them off the hook for this scheme.
- Contact your School Board member an let them know what you think. Should they formally vote on Sept. 8 to hike your property tax, or should they look for other ways to reduce spending or shifting funds to make up for the .25 mill loss?? The Board members who voted FOR the tax increase, and won't talk about rightsizing or reducing wages to compensate, were Kyleene Fischer, Rosanne Brandeburg, Cincy Barrow and Debbie Stivender. Larry Metz voted against it.
As for me, I vote no new taxes until I know how much wages have gone up in the last 5-10 years, and their percent of total spending has not gradually increased as a bigger percent of the total budget, and at a rate faster than local gdp or economic statistics. The Board has done a good job of examining and questioning other budget issues, but they REALLY do avoid any discussion of "right sizing" wages and demanding that teachers increase their share of payments for benefits like most companies do (another issue). I do know that the teachers and staff are not getting any wage increases this year, and even confirmed with Cindy Barrow that they are not receiving the usual, hidden step increases favored by governments. But, by not rightsizing wages to match actual gdp, economic statistics and local business wage levels, after awhile, there won't be any funds for anything but wages and benefits, and in 20 years the District could file bankruptcy like cities and some counties in California are already doing based upon excessive wage and benefit hikes over the last 10 years.
Below are the two local newspaper articles on the vote - I did not read them before writing the above comments, so they give some additional background.
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orlandosentinel.com/news/education/orl-lake-school-tax-072709,0,335919.story
OrlandoSentinel.com
SCHOOL BUDGET CRISIS
Lake County School Board OKs extra property tax
Board members reverse course; final vote scheduled for Sept. 8
Denise-Marie Balona
Sentinel Staff Writer
July 27, 2009
TAVARES
Lake County School Board members gave tentative approval Monday night to a new property tax just weeks after saying they wouldn't impose it.
The tax -- 25 cents per $1,000 of taxable property value -- would generate about $5 million, which could be earmarked for building maintenance and buses. The owner of a home assessed at $150,000 with a standard $25,000 homestead exemption would pay $31 more with the new tax.
Seminole County school officials on Tuesday are also expected to approve the tax, which the Florida Legislature is allowing each school district to levy this year and next to help offset major funding cuts. It would raise about $7 million in Seminole.
School Board members in both counties can still change their minds, however. A final vote is scheduled for Sept. 8 in each district.
Lake's School Board chairwoman, Kyleen Fischer, urged her colleagues to reverse course and approve the tax if only to allow the board to continue discussing whether it should ask constituents to pay more for education even as they lose jobs.
If board members had voted down the tax, they could not have changed their minds later. But by approving it, they will be able to continue debating the issue during budget workshops in coming weeks.
"It's an opportunity," said Fischer, who had opposed the tax but changed her mind when she learned Monday that 53 school buses are more than 10 years old. At least some of them need to be replaced, but the district needs more money to do that and pay for other maintenance projects, she said.
Board member Larry Metz was the lone dissenter in the 4-1 vote. He argued that the district should take a harder look at its budget to find more money instead of placing the burden on property owners.
He said the district should fund maintenance needs with some of the $9 million it plans to set aside in case state funding is cut again midyear.
"We should be prudent about this," Metz said. "The opportunity [to raises taxes] will still be available next year."
But some education leaders have said they worry that lawmakers might take away the option to impose the extra tax for 2010-11. Lawmakers will be trying to figure out a better way to fund education when they meet next spring.
Wayne Blanton, executive director of the Florida School Boards Association, said one reason some Florida districts appear to be pursuing the tax now is that they believe it could be a one-time chance to raise money. Orange County Public Schools, the region's largest district, rejected the tax in June.
A public hearing on Seminole's budget for the new school year -- which includes a vote on the property-tax rate -- is set for 5:05 p.m. today Tuesday at the School Board office, 400 E. Lake Mary Blvd., Sanford.
Denise-Marie Balona can be reached at [email protected] or 352-742-5928.
Copyright © 2009, Orlando Sentinel
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School board wrestles with tax increase for capital improvements
LARRY ELL
Staff Writer- Daily Commercial
TAVARES -- When it comes to dicey subjects like raising taxes, discussing even the possibility means governmental bodies in Florida are obligated to notify the public.
So before its regular meeting Monday, the Lake County School Board prepared for some impassioned opinions at a public hearing as it explored exercising an option to increase the property tax $25 per every $100,000 of assessed value.
The money would go toward replacing capital outlay money taken away by the state legislature. That's money needed to maintain buildings, physical plants and school buses.
Passing the measure would be a surprising turnaround by the board. At a special meeting on June 15, 2009, members expressed unanimous consensus against the additional tax levy. Changing tacks now would require approval by a supermajority.
"It would increase the hardships already experienced by the citizens," said board member Larry Metz. "You have to have four votes to pass it and I'm opposed to it. I was in June and I still am."
However, in the crowded county commission chambers, Metz was in the minority. Most of the residents who addressed the board members urged them to approve the tax.
"We must consider what is best for Lake County's children," said Frank Wood of Eustis.
"The roofs need to be kept fixed and the air conditioners need to stay working," said Karen West of Yalaha.
"Maintenance is a fundamental element to keeping a school system running," said George Foley of Montverde.
For such a potentially volatile issue, the tone at Monday's meeting was very civil and respectful even by those who would have to bear the cost of the new tax and financially would be hard-pressed to do so.
"I don't want you to not fix a roof or maintain a bus," said Patricia Sullivan of Eustis. "But I do want you to do what the nation is having to do, what I'm having to do and that's tighten your budget. I know it only seems like $25 dollars, but we're also getting it at the gas pump and at the grocery store. I would suggest the courageous thing to do is consider looking at the budget and see if there can be cuts anywhere else."
After the public had its say, board members took hold of the discussion and it appeared that most were swayed by the pleas of those supporting the tax increase. Chairman Kyleen Fischer urged the board to approve the tentative increase so that they could buy more time to study the individual school budgets and look into school bus maintenance issues before a final decision would have to be made on Sept. 8.
"It's an opportunity for us to be prepared," Fischer said. "I don't see any positive indication of any more money coming to the Lake County school system."
One by one, board members had their say, and most appeared to be in favor of keeping their options open. By consecutive 4-1 votes, with Metz being the lone dissenter, the board approved the tentative millage increase along with the tentative budget. Over the next six weeks, school officials will focus intense scrutiny on the budget before giving it their final stamp.
"I do believe we will be faced with paying now or paying much more later," said school superintendent Susan Moxley. "I feel an obligation to the needs of the students of this district."
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