Lincoln County Journal

Follow Us On:

Winfield school board weighing tax levy options

Posted on Wednesday, August 2, 2017 at 7:00 am

By Megan Myers
Staff Writer
While steep increases in county property assessments may have raised some eyebrows this past spring, they are unlikely to raise property taxes much.
That’s because of a state law called the Hancock Amendment, which prevents tax districts from receiving a windfall from increased property values by capping off tax revenue at the consumer price index.
The amendment sometimes makes it necessary for districts to adjust their tax levies in order to avoid going over the cap: good news for tax payers, but for local school districts, it means getting creative with their finances.
For the Winfield School District, the amount to be rolled back from the operating tax levy would be around 30 cents per dollar of assessed value, or roughly $335,000 annually.
During Winfield School Board meeting July 25, financial advisors from the St. Louis firm LJ Hart & Company talked about how the higher assessments might affect the district, and the best ways to cope with the new development.
“Under Missouri Law, when we have an increase over the consumer price index, there’s a calculation made on the district’s operating tax rate ceiling,” Larry Hart, the company’s CEO explained.
For the 2016-2017 fiscal year, the school district’s total tax levy was $4.3394. The incidental fund was at $3.1694, while debt service was at 1.05, and capital improvements were at .12.
Sarah Buczkiewicz, the financial firm’s vice president, presented the board with a plan to transfer the 30 cent roll back into the debt service fund, which would not increase the total tax levy for the district.
“Instead of dropping the incidental and capital projects fund levy, and dropping your total levy by about 30 cents, we would keep that total levy at almost $4.34 by transferring that to debt service and having $1.35 in debt service,” she explained.
Hart said that besides keeping the district’s total tax levy stable, the proposal would allow the district to pay off bonds purchased in 2014 much sooner than originally planned, saving more than an estimated $1.4 million in interest.
Hart said it would also place the district in a position to increase its bonding capacity in order to fund new capital projects for 9.5 million or more as early as 2020.
Hart said the rollbacks this year would not have been as dramatic if assessed valuations had risen incrementally over the past few years instead of rising so sharply in one year.
“In reality, if those assessed values had been properly figured for the last four to five years, they would have been incremental increases,” he said. “There might have been some years when they were above the CPI, some years they would not have been. The rollback of the operating levy would have been more gradual and less pronounced than what we have here.”
New District Superintendent Daniel Williams said he is optimistic about the plan.
“In the past, we might have had to go without with some things in the district. Now we have an opportunity to fix the problem,” he said.
The district will hold a tax levy hearing on the issue Aug. 15 right before the board’s regular meeting begins at 6:30 p.m.
School board members Wesley Burch and Josh Berry were absent from the July 25 meeting.

 

 


NASCAR