Misconceptions about Holton B.O.E. resolution shared by Supt. Davies
There appears to be some misconceptions about what the Holton Board of Education is requesting from its taxpayers. I get it! This stuff is hard to understand and no one wants their taxes to go up. So I will try to really get to the basics of what is going on with the board asking for the authority to raise the Supplemental General Fund or Local Option Budget (LOB) from 30 percent to 33 percent.
In the end – the superintendent and the board of education want to leave your mill rate the same year after year and this is the only way to accomplish this. Holton’s board of education does not want to raise your taxes – they want to leave your mill rate the same.
First issue – The board is rising our taxes three mills.
This is not true! The resolution was not so the board could raise taxes; it was intended to keep your mill rate the same.
Second issue - Why do we need to go from 30 percent to 33 percent and what does this mean?
The board is not asking to go to 33 percent. They are asking for the authority to go to 33 percent. That actually sounds worse or like something a politician would say, yet the percentage is tied to the general fund.
So without going into school budget 101 too far, the general fund is collected or funded mostly from property taxes, and everyone’s property, land, house, business or industry is taxed at 20 mills.
Then this money goes to the state and is redistributed to all schools based on student enrollment, poverty, low enrollment, technical classes, etc…
The percentage for LOB (the 30 percent to 33 percent) is based on this grand total because not everyone’s 20 mills in each school district is created equally (although the 20 mills you pay is calculated exactly the same as everyone else’s).
The 20 mills people in the Holton district send in is not enough to cover what the state has determined is the amount due to educate the students in the Holton district.
Third issue – Yeah, but my taxes on my house keep rising so I am paying more taxes.
I see this on my assessed valuation as well. When my house is appraised by the county for more money as they have determined that it is worth more money, then yes, you will pay more taxes.
There is no way to sugarcoat this; your taxes that you pay annually do go up when your property, home, land, business, or industry’s value goes up.
The school does not control this, nor do they want to, but by keeping the mill rate the same, the school district is not the cause of your tax increase. The school board and superintendent are trying to keep the mill rate the same year after year.
Fourth issue – Why would the state allow schools to go from 30 percent to 33 percent?
I believe the only reason the LOB is stuck at 30 percent of the general fund budget is so that districts who receive state aid for this fund do not get too far out of balance with the rest of the state.
The reason this number is allowed to approach 33 percent with a resolution is again because not all districts generate the same amount of money with their mill rate. Sounds like circular logic, but think about it - if one district can collect $50,000 with one mill and another district can collect $100,000 with the same one mill, then the second district can lower their taxes to .5 to collect an equal ($50,000) amount. That is where things really get uneven really quickly.
This is happening all over the state and that is why we receive state aid.
Fifth issue – What is this state aid and why do we care? Don’t we just pay more taxes to the state to make up for this?
State aid is the method the state utilizes to equalize property taxes and the answer to the second question is NO!
As a matter of fact, if we do not utilize this for our own students, other school districts will get to use it for their students, as it will get redistributed somewhere else.
Keeping the mill rate the same will not overtax anyone else in the Holton school district or in the state, yet it will keep your students receiving the same rate while almost keeping up with the consumer price index (inflation on goods, utilities, insurance, etc.).
The state aid is equalized for school districts that do not generate the same money for the mills they take in compared to the average district assessed valuation in the state.
For every dollar we brought in last year, we were equalized another 66.2 percent, or for every dollar we collect, the state matches another 66.2 cents for a total of $1.66.
Back to the last explanation, some districts that are the same size generate $2 or more on their own for each dollar we generate. So we are still behind.
Last point – Shown above is a graph of the Holton School District mill rate for the last 5 years fiscal years (FY).
Notice the LOB consistently going down? This is because the 30 percent is strangling our ability to keep the mill rate locked in at a consistent rate after FY 18.
Thirty percent is not allowing the students of our district to have the same opportunities as surrounding districts, and the state aid we are entitled to is also going to other students in the state.
Please, if you have questions, contact me at the district office. Bring a friend to talk as well if you need to. Call the district office at 785-364-3650 or email me email@example.com a time I can contact you on the phone so you can stop by and we can chat.
Holton Superintendent of Schools