There’s always more to the story than meets the eye.
Upon first glance at the agenda for next week’s District #18 Board of Education meeting, an item under the ‘action’ agenda involves raising the school district’s tax asking authority by up to seven percent. According to Superintendent Mike Brockhaus, the agenda item needs an explanation.
“As you may know, Nebraska recently enacted LB 243, part of which included the new School District Property Tax Limitation Act (the “Act”). The Act created a new default rule capping the magnitude of a school district’s property tax request authority. This limit is in addition to other preexisting limits on school district’s levy authority and budget growth. Those other limits remain in place and have not changed.
“The limit of a Nebraska school district’s property tax request authority is now based on (1) the previous year’s property tax request, (2) the previous year’s non-property-tax revenue, and (3) the estimated non-property-tax revenue for the current year. The amount that the sum of this year’s property tax request authority and non-property-tax revenue can grow (in comparison to the sum of the previous year’s property tax request and the non-property-tax revenue) is set at a specific amount under the Act. This amount of growth is called the base growth percentage.
“The Act also empowers the school district to exceed the new default property tax request authority. One of the methods to do so empowers the Board of Education (upon affirmative vote of 70% of all board members) to increase the base growth percentage that is used to determine the school district’s property tax request authority.
“The Board of Education for Elgin Public Schools plans to consider whether it will increase the base growth percentage used to determine its property tax request authority at its upcoming August 8, 2023 meeting. It is important to recognize that such an increase would be for the purposes of providing the Board flexibility in the amount of property tax request authority. But this does not necessarily mean that the property tax request that the Board actually approves later this fall–as part of the budget-setting and approval process–will correspond to this increased amount. That is because a school district’s actual property tax request does not necessarily need to be the same as its property tax request authority; and, in fact, it can be less.
“This new limit created by the Act does not depend in any way on the levy limit, land valuations throughout the district, or anticipated revenue that will result from property taxes. Once the actual budget is prepared and considered, it may be that the actual levy rate remains the same or is even reduced. The Board’s anticipated vote on whether to increase the base growth percentage will not necessarily represent an increase in the property taxes that are paid, but simply provides the Board flexibility in determining the amounts that it can request at a later date.
“The school district takes seriously its responsibility to be a good steward of taxpayer funds. The Board of Education will act consistent with this responsibility as it prepares, considers, and approves its budget for the 2023-2024 school year, all in light of the meaningful input that members of the public will have the opportunity to provide.” The board meeting will be held Tuesday night, beginning at 7:30 p.m.
