LCSD declares shortfall of $ 3 million in local tax revenue
The Lowndes County School District Board of Directors met on Tuesday to declare a shortfall of more than $ 3 million in local revenue for fiscal 2021.
The shortfall is the difference between the amount the district requested from county supervisors in local taxes for the year and the lesser amount that supervisors approved for LCSD. By declaring a deficit by June 30, school officials said, the district can borrow the $ 3 million and pay it back over the next three years by increasing the debt mileage specifically for this purpose.
In August, the LCSD requested about $ 21.1 million from local property tax collections for the operations, but supervisors rejected the request, providing only about $ 17.9 million instead. This forced the district’s tax rate down almost 2 miles.
A mill is used to measure property taxes. For example, someone who owns a $ 100,000 home with no homestead exemption pays $ 10 in taxes per mill.
By law, a school district can request an increase of up to 4% in local revenues for operations each year, as well as “new properties,” properties that were added to the tax rolls over the last year. year, without referendum. The problem is what constitutes new property, and the LCSD has sued county supervisors in the chancellery court for clarification of state law.
“As you know, the supervisory board chose not to give us any new properties,” business manager Sayonia Garvin told the school board on Tuesday. “Instead, they decided to give us what they wanted (that we have).”
The LCSD has attempted to claim companies whose expiry compensation agreements have expired – agreements for large industries that were allowed to pay fees equal to one-third of their total taxes in their first 10 years of operation. operation – as a new property, which would have generated an additional $ 2.5 million in school taxes. While the district argues that these industries are “added to the tax rolls” when they start paying full taxes, the county argued that they have been assessed and scheduled for 10 years, even though they only paid a reduced tax rate.
Superintendent Sam Allison called the county’s argument an attempt to “get around the law.”
“If we don’t claim it when it comes to the tax roll, we’ll never get it,” Allison told the LCSD board on Tuesday.
The school district’s case against the county remains unresolved, and Allison told The Dispatch on Tuesday that the missing loan will essentially function as insurance until it is.
“There’s no way we will lose, in my opinion,” Allison said. “… We will know for sure before we put (the loan money) in the bank.” “
LCSD attorney Jeff Smith, a former lawmaker who said he helped draft laws regarding school taxes and new properties, is equally confident in the district’s position in the court case.
“If we lose, the legislature will have to step in because that was not the intention of the law,” he said.
A shortfall doesn’t mean a shortfall in this case, Allison told The Dispatch after the meeting.
The LCSD projects a positive fund balance for the year, which ends today, meaning it would have more general cash reserves than the roughly $ 11 million it ended up with during the fiscal year 2020. At the end of 2019, he said the fund balance had depleted at around $ 5 million.
Allison credited deferred maintenance, as well as “cutting costs everywhere except in the classroom” for the best balance. Federal money from COVID-19 relief, which can only be used for certain purposes, will also help in fiscal 2022, he said.
“We are in a much better financial situation than we have been,” Allison said.
Zack Plair is the editor of The Dispatch.