School Board Says Yes to Levy Referendum in the Fall

No one likes to ask residents to pay more in taxes, Mickey Difronzo noted during the School District 199 School Board meeting on Monday night. But without new revenue, the board chair added, the district will be forced to make “serious reductions.”

Which is why the board voted 6-0 to pursue the three separate levy options in a levy referendum this fall. If local voters across the district approve all three during the special election scheduled for Nov. 8, the proposals could generate as much as $4.2 million in tax revenue annually for the district. Board member Bridget Sutton was absent for the vote.

Here is a breakdown of the three levy referendum questions the district will pose to voters:

• The first option is the renewal of an existing tax levy that generates roughly $480 in per pupil funding annually for the district’s operations—or approximately $2 million in annual revenue. This levy is one of two levies the district currently has in place, and is set to expire in 2013. The expiring levy currently accounts for roughly 5.25 percent of the district’s general fund revenue, School District 199 Business Manager Bruce Rimstad said earlier this year. If renewed, the levy would take effect in 2013 and continue for ten years.

• The school board is also pushing for a new capital project levy, which can only be used to purchase new computers and other technology, textbooks, software or to maintain existing technology in the school district. If approved, this levy would raise $700,000 in new annual tax revenue in 2012—and as much as $7 million over its ten-year lifespan.

• The third option the district will put to voters is a new, $372 per pupil levy that would generate roughly $1.5 million in new tax revenue each year for the district. The levy would have a lifespan of 10 years and would take effect in 2012 if passed this fall.

The board’s decision to call a levy referendum comes on the heels of roughly , made in March, which included the elimination of 12 full-time equivalent (FTE) staff positions in the district. Over the last 10 years, the district has cut roughly $6.5 million from its budget.

Stagnant state funding, gradually declining enrollment in the schools and the rising cost of food, fuel, electricity have driven the district’s need for more revenue, Superintendent Deirdre Wells said.

The district will have to continue to make incremental cuts if the $480 per pupil levy is renewed, but neither of the other options pass, Wells said. If none of the three options pass, the resulting cuts would be “decimate the entire system,” Wells said.

If the renewal alone passes, Wells noted, residents would not see an increase to their property taxes, thanks to declining property values. The owner of a $200,000 home will pay $175 in property taxes in 2012 due to the existing levy, according to information provided by the district.

If the capital projects levy passes, the owner of a $200,000 home would see a property tax increase of $57 in 2012. If the $372 per pupil levy passes, the owner of a $200,000 home would see a $135 tax increase in 2012.

“We understand it’s a very difficult time, but we have a lot of people in the community that have come to us and said we want our kids to have a good education,” Wells said.

The levy referendum will coincide with school board elections this fall. Four board members, including Difronzo, Keri Myran, Bridget Sutton and Phil Prokopowicz, are up for re-election. Candidate filing for the election opens on Aug. 2.

“We don’t put money in the bank, we spend money on the kids,” Prokopowicz said during the meeting on Monday night. “It is an investment, but I think the citizens of the district and voters of the district will understand it’s a good investment.”

HOW DOES THE DISTRICT STACK UP?

Currently, the district only receives $844 in per pupil funding through its two levies. That amount is one of the lowest in Dakota County, and means that Inver Grove Heights residents carry a smaller school-related tax burden than residents of neighboring districts, according to data gathered by district officials.

In Inver Grove Heights, the owner of a $200,000 home paid $806 in school-related taxes in 2011, whereas the owner of a similar home in the Rosemount-Apple Valley-Eagan district paid $991 in school taxes in 2011. For a full list of comparisons and more information about the levies, click here.