The Tooele County School District will hold a public hearing next week to explain why it needs an extra $1.1 million in property tax revenue next year.
The school district has proposed to keep the district’s property tax rate at the current level of .009593 instead of lowering it to the 2014 certified rate of .009233.
The certified property tax rate is the rate that will yield the same amount of property tax revenue for the district in 2014 as it collected in 2013, not including revenue from new growth.
After a year of budget reductions, the district is now in the position where it needs additional revenue, according to Scott Rogers, Tooele County School District superintendent.
“We started this journey by cutting expenses, not by raising taxes,” he said. “What we are proposing is a flat levy rate with earnings moved into a capital reserve fund for future facility and building needs.”
Under Rogers’ leadership, the district trimmed 2013-14 general fund expenses by $1.7 million.
The district’s move to keep the tax rate flat, despite a reduction in the certified rate, is part of a 10-year long-range capital plan approved by the school board in March.
There is a need for local generated capital revenue to replace a sharp reduction in state capital revenue for the school district, according to the plan.
In 2008 the state allocated $5.3 million to the Tooele County School District for capital expenses. In 2013 the allocation was $430,000.
Enrollment projections included in the long-range plan means that expenses for property acquisition and new buildings are an inevitable part of the district’s future, according to the plan.
Slowly building up a capital reserve fund by small increases in property tax through a flat tax rate is preferable to a larger, voter-approved bond for new buildings, Rogers said.
The capital reserve fund will be used to reduce the amount the school district needs to bond for when a new building is needed, resulting in lower long term debt service, he added.
Another piece of the long-range capital plan is a general obligation bond issue that is scheduled for this fall’s general election.
The new general obligation bond, if approved by voters, will replace the school district’s high interest long-term debt with low interest voter approved general obligation bonds.
Once the new general obligation bonds are approved, the capital part of the school district’s tax levy will be reduced, so the net effect will be revenue neutral and not result in a tax increase, according to Rogers.
“In short, it will cost taxpayers more in the long run if the board does not follow through on these two steps and/or the voters turn down the bonds in November,” he said.
However, the decision to not let the tax rate float down to the certified property tax rate means the owner of the average home in Tooele County will pay more in property tax for schools in 2014.
The tax for the school district paid by the owner of the average home in the county, valued at $170,000, will pay $897 in 2014 instead of $863, $34 more or a 3.9 percent increase.
The increase in property tax revenue requires the school district to hold a truth in taxation hearing.
The hearing will give district officials the opportunity to explain their reason for the increase in revenue and hear public comments.
The hearing will be held on Aug. 12 at 7 p.m. in the Tooele County School District Office at 92 S. Lodestone Way.
The last property tax increase was in 2012 when the school board adopted a tax rate that was 9.1 percent over the certified rate.