Facility maintenance, inflation cited as reasons

Long-term facility maintenance funding and keeping up with inflation rates were two reasons the district proposed a tax levy increase, the Albert Lea deputy superintendent said.

The proposed tax levy contained a 5.11 percent increase and passed 4-1 at Monday night’s school board meeting.

Albert Lea Deputy Superintendent Lori Volz said the long-term facility maintenance funding was the main driver of the levy increase. The funding will be used for deferred facility maintenance costs. The general fund will see an increase in funds of approximately $148,000 as enrollment is projected to increase, and the long-term facilities maintenance funds will increase by approximately $408,000.

According to certified public accountant Greg Larson, who presented the district’s 2016-17 tax audit, 9 percent of the district’s general fund came from local property taxes.

Volz said the increases would be partially offset by reduction in other levy categories.

The levy limitation set in 2016 for 2017 was set at $7.82 million. The new levy limitation was raised to $8.2 million.

“The grand total of all the increases or decreases in one line item or another come to the $400,000 increase,” Volz said.

“This is such an important funding stream,” Volz said of the levy.

Volz estimated that for a homeowner with a property valued at $100,000, the school tax will increase by $25.

School board member Jill Marin noted that the $25 increase came in at around 6 percent, not 5.11, in a change from a $412 tax to $437.

Volz said the amount of tax paid for the levy could appear to be more or less than the 5.11 percent for two reasons: changes in the value of an individual’s property, or changes in the total value of all property in the district. Increases and decreases in levy amounts can be caused by changes in state funding formulas, local needs and costs, and other factors, Volz said.

The tax levy does not necessarily determine a change or increase in budget.

“It’s just a component of the funding formula,” Volz said.

Volz said falling behind inflation and underfunding of special education “are two huge challenges for public schools,” and why districts offer referendums for school funding. For the 2017-18 school year, Volz said all school districts in Minnesota have referendum revenue and/or local optional revenue levies, which average out to $1,296 per pupil.

She said the funding formula would need to increase by another 9.4 percent to keep pace with inflation since 2002.

School board member Dave Klatt said while he has seen his personal property taxes continue to go up, he is glad the number is not higher. He said he has seen other districts propose 8 or 9 percent.

“A long time ago, I learned that when I went to school, someone paid for my education,” Klatt said.

Marin voted no for the levy increase because she said the price is too high for taxpayers, who “do not have bottomless pockets.”

“I believe 5.1 percent, which equates to a 6 percent increase for the average homeowner, is burdensome on the hardworking families and elders in our community,” Marin said in an email. “Government entities should work within their means, just as taxpayers are required to do.”

Marin said the audit exposed areas in which district spending is over state averages, and this indicated to her room for changes in spending.

According to Larson, the tax audit showed that overall, the district had a good year.

“Pretty much all your funds within the district held their own or slightly improved,” Larson said. Larson compared the district’s 2016 funding numbers with those statewide and with those from Minnesota districts of a similar size to Albert Lea. In vocational instruction, special education and instructional support services and debt service, Albert Lea’s district is spending more than comparable districts and the statewide average. Volz attributed the vocational instruction cost increase this year to additional programs that were approved and a reallocation in some staffing costs from regular to vocational. The instructional support services includes additional costs for technology and equipment.

Larson said the district’s spending for special education is in line with years past.

“Your district, historically, has been higher than the state average in your special education costs,” he said. He noted that in previous years, this was due to a higher percentage of special education students enrolled. Although this year there was a drop in that number, student numbers look to be up again this year.

Larson said the district is spending below comparable districts and the state level in the site buildings, pupil services and transportation categories. He said the district is in line with comparable districts and the state level in regular instruction spending and food service.