COLUMBIA — Facing a $10.3 million budget shortfall, the Columbia School Board gave the go-ahead to putting a property-tax levy increase before voters this April.
The measure would raise the tax levy 54 cents, increasing the tax to $5.21 per $100 of assessed value. It would also be the first time the board has asked for an increase in five years, when it raised the tax levy by 19 cents.
Levy history1984: 16 cents 1986: 58 cents 1988: 17 cents 1990: 46 cents 1999: 58 cents 2003: 19 cents 2008: 54 cents *Current proposed increase
The board approved the measure in a 7-0 vote late Monday night.
Throughout the evening, board members said they did not look forward to the idea of raising taxes, but they could not look past the overwhelming deficit facing the district.
“It’s a pretty responsible recommendation,” said Darin Preis, who is the vice president of the board. “Our expenses are overpowering our revenues.”
Nick Boren, chief of operations for the district, said some of the budget shortfall is the result of increased hiring by the district and pay raises.
“This deficit was calculated from six months of financial data,” Boren said. “Increases in expenditures came from the addition of several FTEs (full-time employees) and a $1,000 increase in teacher base salary and increases in retirement.”
At the moment, the Columbia School Board is expecting a $10,353,395 operating budget deficit for the 2007-2008 fiscal year. Based on the board’s calculations, each 1 cent increase in the levy generates $190,000 net tax revenue each year for the budget.
If the tax levy increase is approved, a home that is assessed at $100,000 will force a homeowner to pay an additional $103 a year in taxes, Superintendent Phyllis Chase said.
In fiscal year 2006-2007, the district had roughly $153.7 million in revenues and roughly $164 million in expenses.
Chase, who floated the idea of increasing the tax levy, said that every five to seven years there is “a need for budget correction.”
She added that with a softening economy, “This isn’t going to be a slam dunk year” for revenues.
Under the plan, the district would find ways to cut $5 million in expenditures, while the tax levy increase would pick up the remaining amount.
Chase said the district would accomplish this goal by changing the process by which it formulates its budgets. The new method will base budgets off revenue trends from the previous three to four years.
“It is times like these that we ask for public support,” Chase said of proposing the tax levy increase. “We think the district should share the burden of the deficit.”
Board member Steve Calloway suggested that the district survey teachers and administrators “to tell us where dollars are being wasted and have them recommend cuts.”
Calloway added that he thought the board acted responsibly by keeping the tax burden to 54 cents, even though he thought the district might need more tax revenue.
In 2003, the board decided to seek an increase as a means to make up an anticipated shortfall of almost $11 million in state funding. The board raised the tax levy in 1999 to pay for increased teacher salaries and to hire additional teachers.
Under the district’s proposal, the increase would pay for carrying out the existing salary structure, increases in fixed costs, and new operating expenses for a planned elementary school and high school. However, the levy will not cover increases in base salaries, additional positions or deficit spending.
Additionally, the district is projecting that state funding will remain relatively flat while expenditures continue to fluctuate.
Ines Segert, an MU psychology professor who attended the meeting, said she was interested in finding out about the financial state of Columbia schools.
She said the district should have looked more carefully at hiring more people and the costs associated with it.
While taxpayers might grumble about the extra money they will have to shell out, Chase said it was worth it.
“Fifty-four cents would give us approximately five years of solace,” she said.
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