The District 200 Finance Advisory Committee will likely recommend that the D200 school board adopt a flat or reduced levy next month.
The committee discussed both possibilities on Monday. Some committee members strongly backed the reduced levy option while others favored a flat levy. The group will finalize its recommendations on Dec. 2, concerning the proper size and use of the school’s $118 million fund balance.
The group on Monday took its first steps toward committing to a levy recommendation, which it had not up to this point.
Last week, the D200 board approved its preliminary levy, calling for a roughly 2 percent increase. The board made that vote with the understanding that the ad hoc committee was still finalizing its recommendation with respect to the fund balance and a possible recommendation concerning the levy, which will receive a final adoption by the board on Dec. 19.
The D200 board last week noted that the final levy vote would be influenced by whatever the FAC recommends, which will likely come forth on Dec. 10, a week before the school board officially approves its levy for next year.
FAC members met at their scheduled meeting on Monday and looked at a several options the board could take with next month’s levy adoption, including approving a flat levy for the next four years. Other options included a small levy decrease or giving a large tax cut. Some committee members argued that the board should adopt some kind of levy decrease to gain favor with the public.
“Is it not possible to try and re-build the goodwill with the community to have not just a flat but a modest reduction in the levy?” asked committee member Karen Latham.
Maintaining a flat levy wouldn’t draw much support in the community, Latham added.
The committee looked at the option of an $8 million levy decrease and also the option of a massive $45 million tax cut next year. A huge one-year tax cut, however, was ultimately ruled out in favor of a more modest reduction.
Latham argued that something below an $8 million decrease could suffice.
Supporters of the flat levy, however, argued that maintaining the tax rate could also be seen as good financial stewardship and a trust-builder. Members noted that a flat levy for one or two years could be followed by a levy decrease after that.
While the committee did not decide on either option Monday, committee members seemed open to the idea of modest decrease.
The committee looked at four overall options. A couple of options involved maintaining a flat levy until the school faces an operating deficit. The school board could then go for a full CPI levy increase either a year or two prior to entering deficit spending.
The other options involved either an $8 million decrease or tax cut next year. The committee concluded that a large tax cut would be too complicated to do in one year, with implications involving how the county would handle such a request with what would amount to a month’s notice — the D200 board needs to finalize its levy on Dec. 19.
As the committee discussed how property owners are impacted by the levy and fund balance, Supt. Steven Isoye reminded members about how this all impacts the students.
“The only key point I would make as we look at the numbers and projections, graphs and lines, we’re also talking about the experience of the students,” Isoye said. “A lot of the things that are built into the graphs and numbers are parameters that pretty much maintain the status quo and how we staff a variety of things.”
Isoye, as well as committee members, also acknowledged that the school’s strategic plan will include initiatives with financial impact.
The committee Monday continued to talk about how the school can rebuild trust with the community. Latham warned that if the board makes the wrong decision concerning the levy and fund balance, that could further build distrust. The current feeling in the community, she noted, is that the school is just looking to spend money it’s stockpiled in the bank.
Latham said the school and board can re-build trust by seeking the community’s support on what to spend the money on.
“I worry that the good will that is gained by virtue of the efforts spent on what to do with the tax levy, whatever money we would need to spend on capital projects would need to have the support of the community,” she said. “Having a large fund balance does not mean you have the consent of the community to spend massive amounts of money on what may be really great projects, but the community has to say yes.”
CONTACT: tdean@wjinc.com