Voter approval on an April ballot issue will allow Raymondville School to capture extra state funds without raising taxes.
It’s a complicated matter, but Superintendent Nathan Holder says it will aid the district.
On April 7, Raymondville patrons will be asked to approve a tax levy increase of 48 cents per $100 of assessed property valuation, and school officials want voters to realize that this does not mean an increase to the total tax levy. Changes in the state funding formula for public schools in Missouri have created an opportunity for the school to create additional revenue because of their current tax rate.
“Voting yes on this proposition will generate approximately $30,000 yearly without raising the total tax levy,” Superintendent Nathan Holder said.
Under the state funding formula created three years ago, schools with 350 students or less get money from a “small schools fund,” $10 million is distributed statewide according to attendance, and schools with a tax levy of at least $3.43 are eligible for a cut from an additional $5 million.
Raymondville currently only draws from the $10 million pool even though Raymondville’s total tax levy is above the $3.43 threshold. The reason is because Raymondville’s total tax levy is split into two funds: debt service and operational. The state specifies that the operational levy must be at $3.43 or above, to draw from the $5 million pool of money. Debt service now costs Raymondville patrons $.4743 cents per $100 assessed valuation, and that amount added to the current operational tax levy makes the total district tax rate $3.4673. If the $.48 increase to the tax levy is approved, the board has agreed to lower the debt service to $.00, meaning patrons will pay a maximum $3.47 tax rate, comparable to the current rate of $3.4673.
The original debt service levy was for a voter-approved new middle school wing in 1998.
Voters at the time approved a 20-cent tax levy increase for general operations and also a 72-cent debt service levy to pay for the new wing. For several years the total tax levy was at $3.67 per $100 of assessed valuation. The voters will also be guaranteed in the ballot language that this levy increase will sunset after 2013, which is when the original bond, approved in 1998, would have been paid off.
The current funding formula allows districts to place money schools get from state lotteries and casinos (called the Classroom Trust Fund) in any fund, and Holder said those dollars would be used to make up the difference on the debt payment. Raymondville currently receives around $61,000 each year from this fund, and the debt service obligations amount to only $36,000 per year. Because the new formula allows this Classroom Trust Fund money to be used in any fund, the debt service can be dropped to 0, but the school will still have the necessary funds to pay off the debt obligation if the operating levy is increased.
“If not for the small-schools fund, the district wouldn’t be proposing this,” Holder said. “However, given the current funding formula, we think it makes financial sense for the district to take advantage of this opportunity.”
When asked what will happen if voters don’t approve the increase, Holder said Raymondville students will miss out on $30,000 additional funding each year and Raymondville patrons will still pay the same or more in taxes. State law requires a proposed tax levy increase go to the voters, even if the board of education willing drops the debt service levy correspondingly.
Three presentations will be made to patrons of the Raymondville School District with the first one taking place at 7 p.m. Tuesday, Jan. 27, at the school gymnasium. Holder welcomes any questions or comments regarding the proposal and can be reached by calling 417-457-6237.