Washington Evening Journal

Fairfield Ledger   Mt. Pleasant News
Neighbors Growing Together | Aug 19, 2018

Will The School Levy on Property Tax Go Down? Yes, No, Maybe, ask your legislators

By Mike Jorgensen

The Iowa Code states that the State Supplemental Aid for Schools should be set within 30 days from the time the Governor sets the budget for the following school year.   So the State Supplemental Aid for the 2015-16 school year was supposed to be done during February of 2014.    That didn’t happen.  The Iowa House refused to set a rate last year even though the Senate made numerous attempts to pass rates for schools.  The House simply ignored the law and refused to discuss this issue.
Why is the law on the books?   Schools have to set their budgets by April 15.  By setting the rate a year prior, it gives schools plenty of time to prepare their budget and to determine their ability to negotiate with and hire staff.  Since a rate was not set last year, we are in March of 2015, a little over a month until our law says we have to pass a budget and we don’t know what we have to determine a budget.   We are required to follow the law even though the Iowa House did not.   Does that seem fair to anyone?
Have you ever tried to set a budget without knowing how much income you will have?   This will be the second time in my career as a Superintendent that this has been the case.  At this point in time, I anticipate that State Supplemental Aid will not get resolved until the end of the session, sometime in May.  I also would predict that if/when the State Supplemental Aid gets set, it won’t include the 2016-17 rate, which by law was supposed to be set last month.   
Tax rates for the Washington Community School District have been on a favorable trend for the patrons of our district.    The Following are the rates since FY 11:
FY 11    $17.46
FY 12    $16.76
FY 13    $15.73
FY 14    $14.64
FY 15    $14.45**

**Includes the 40 cents per $1,000 for Auditorium
Reduction of $3.01 since FY 11

So what will the Tax Rate be for the Washington Community School District?   Because of the uncertainty, we have to work from the worsetcase scenario as far as a published rate.  The worst case scenario is that the issue does not get resolved in this legislative session.   If State Supplemental Aid does not get set, it automatically goes to 0%.    I certainly hope this isn’t the case but if that happens, our tax rate would be $15.05, a 60-cent increase.
The House is currently proposing a 1.25 percent increase in State Supplemental Aid.   At 1.25 percent, our tax rate levy would be $14.70, an increase of 25 cents.    A 2 percent increase in State Supplemental Aid  means a rate of $14.50, an increase of 5 cents.   The Senate has proposed a 4 percent increase, which would result in a rate of $14.38, a 7-cent reduction.   
If you live in a world of compromise, you believe that the rate will end up being somewhere in the middle between the House 1.25 percent and the Senate 4 percent.  Starting at 2.5 percent up to the 3 percent mark, the rate would be $14.35, a 10 cent reduction in our asking.    This is where I do believe we will end up.  Somewhere between 2.5 percent and 3 percent.   If this is the case then taxpayers will see a continued trend for the 6th year in a row where they will see a savings on property tax.   I guess at this point, it is in the hands of the legislators who are able to not follow the law while we are being forced to publish a budget on April 15 to follow the law.   We will be publishing at the $15.05 rate, which is the highest rate that could be charged.   We are hoping a compromise will happen that will result in a rate much lower than that.