Public Hearing
On August 26, 2019, a public hearing was held regarding the re-allocation of tax millage in the Logan-Hocking Local School District. The resolution authorizes changes to unvoted permanent improvement levies, detailing the specific millage allocations and their purposes. Learn about the proposed resolutions and the impact on real estate taxes.
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Presentation Transcript
Public Hearing August 26, 2019 The Logan-Hocking Local School District Re-allocation of Inside Tax Millage Paul F. Shaw CPA CGMA RSBFO - Treasurer
QUICK OVERVIEW - What does the resolution say? - What does the resolution mean? - What is the difference between unvoted millage vs voted millage ? - What are permanent improvements? - What are the needs of the School District? - Why act now to pass this resolution? - Will my real estate taxes increase? Questions and Discussion
Resolution Authorizing CHANGES to PREVIOUSLY EXISTING UNVOTED Permanent Improvement Levies (Ohio Revised Code Sections 5705.314, 5705.06 and 5705.09) WHEREAS, a permanent improvement is defined under R.C. 5705.01(E) as any property, asset or improvement with an estimated useful life or usefulness of five years or more; and WHEREAS, the School District is authorized by law to acquire, construct or improve a specific permanent improvement or any class of permanent improvements which could be included in a single bond issue; and WHEREAS, in its budgets for Fiscal Year 2020 (2019-2020) the Board will have identified the need for certain permanent improvements (the "Permanent Improvements") for the School District; and NOW, THEREFORE, BE IT RESOLVED by the Board of Education of the Logan-Hocking Local School District, Hocking, Perry, and Vinton Counties, Ohio, that: Section 1. The Board levy a 2.9 mill unvoted permanent improvement general - levy (currently 1.875 mill) for Tax Collection Year 2020 to fund the Permanent Improvements. Such levy shall also be included in the Tax Budget for Fiscal Year 2021. Section 2. The Board levy a 1.0 mill unvoted permanent improvement - technology - levy (currently .5 mill) for Tax Collection Year 2020 to fund the Permanent Improvements. Such levy shall also be included in the Tax Budget for Fiscal Year 2021. Section 3. It is hereby found and determined that all formal actions of this Board concerning and relating to the passage of this Resolution were taken in an open meeting of this Board, and that all deliberations of this Board and of any of its committees that resulted in such formal action were in meetings open to the public, in compliance with all legal requirements, including Section 121.22 of the Ohio Revised Code. Section 4. Note that this action reallocates existing unvoted inside tax millage. There is no change in the total unvoted inside tax millage rate (3.9 mills total).
WHAT? The Treasurer and Superintendent are recommending that the Logan-Hocking Local Board of Education adopt a resolution at its August 26, 2019 Regular Board meeting that would reallocate the existing, unvoted inside tax millage as follows: Current Proposed 0.000 2.900 1.000 3.900 Change General Fund Perm Improvmt General Perm Improvmt Technology Grand Total 1.525 1.875 0.500 3.900 -1.525 +1.025 +0.500 0.000
Q) approve all local tax levies? What is meant by unvoted inside tax mills ? Don t local taxpayers A) voted outside mills. Unvoted inside mills are provided by the Ohio Constitution and date back to 1910/1928/1934. There are ten inside mills per taxing district in each county. Logan-Hocking School District (LHLSD) was/is allocated 3.90 total unvoted inside mills (NO CHANGE TAKING PLACE). Boards of Education are entrusted to allocate their unvoted inside millage as they deem appropriate. Local tax levies are divided into two types unvoted inside mills and Voted outside mills are mills that are voted on by the public. Local examples of voted outside mills are operating tax levies totaling 26.70 mills approved in 1971, 1975 and 1981 (the School District s last one!), and bond issues approved in 1989 (middle school and elementary additions) and 2001 (Logan High School, middle school additions, all new elementaries, and locally funded initiatives theater, stadium, etc.)
Q) What are permanent improvements ? A) or more. This would include buildings, buses, textbooks, computers and computer infrastructure, equipment, etc. and personnel costs that are directly related to these assets i.e. bus mechanics, technology technicians, maintenance staff. Permanent improvements are assets which are expected to last five years Expenditures out of the permanent improvement fund are restricted. For example, no such funds can be used for administrative or teacher salaries!
Q) and what permanent improvement needs will be met by this reallocation of tax millage? A Needs Analysis was compiled for the School District. Who compiled it A) administrative staff. The following needs were identified and quantified: The Treasurer compiled it in consultation with the Superintendent and - Student Chromebooks/staff computers/infrastructure/maintenance - Textbooks-continued rotation- including online licenses and digital academy needs - Transportation-continued scheduled replacement rotation busses, vans, support vehicles, maintenance - Safety and Security Federal COPS grant (doors/phones/UF emergency radio repeater/backup electric generators (note public forums held 3/2018 and 4/2019) - Debt service for last phase of construction Central & Green Elementaries and the Chieftain Center - Annual provisions for The Arts/Curriculum/Chieftain Stadium turf/track replacement - Current buildings and grounds improvement and maintenance
Q) When, and Why now? A) tangible personal property taxes are paid, is about to increase significantly as a result of the Leach Xpress pipeline (in-service 1/1/2018). Because of this, it is anticipated and expected that the Hocking County Budget Commission will REDUCE the outside voted bond millage tax rate. By the School Board acting now to address its needs, local taxpayers should see minimal impact on their net taxes, if any, as a result of the proposed inside unvoted inside tax millage re-allocation. The School District s assessed tax valuation, on which real estate and The anticipated current REDUCTION in the outside voted bond millage, coupled with recent past years REDUCTIONS in the same, should offset any potential impact of taxes increasing as a result of the inside tax millage reallocation. This is an attempt to levelize taxes, versus seeing taxes go up and down as attempts are made to address needs of the School District. If done at another time, taxpayers would more than likely see an increase in taxes.
A Quick Look at the School Districts Tax Rate History
1.6 mill decrease since 2015 (est)
The Notice of Public Hearing LOGAN-HOCKING LOCAL SCHOOL DISTRICT HOCKING, PERRY, AND VINTON COUNTIES, OHIO The Notice of Public Hearing , required to be published twice in the Logan Daily News, included wording required by the Ohio Revised Code that said my taxes might increase as a result of the Board s action . NOTICE OF PUBLIC HEARING (Revised Code Section 5705.314) Why did it say my taxes may increase? Will my real estate taxes be going up? Education (the Board ) of the Logan-Hocking Local School District, Hocking, Perry, and Vinton Counties, Ohio (the School District ) at 5:00 p.m., Monday, August 26, 2019, at the Logan High School Library, 14470 St. Rt. 328, Logan Ohio 43138. The public hearing will solely address a proposal of the Board to change its levies within the ten mill limitation to 2.900 mill (currently 1.875) for permanent improvements GENERAL, to 1.000 mill (currently .500 mill)) for permanent improvements TECHNOLOGY, and to 0.000 mill (currently 1.525) for the General Fund - of the School District. There is NO CHANGE in the TOTAL levy within the ten mill limitation (3.900 total mills before and after the proposed change). Such proposal would commence in 2019, and be first effective in calendar year 2020. There will be a public hearing of the Board of increase in the amount of real property taxes levied by the Board. The change proposed by the Board may result in an
Why the hearing notice states , by law, that . May result in an increase in tax amount of real property taxes levied Assume: No change in school district tax base, school district at 20 mil floor, move 1.525 inside mills General Fund to Permanent Improvement Before After 25 25 20 20 15 15 Outside Outside 10 10 Inside Inside 5 5 0 0 NOT Logan-Hocking s Situation- The above would result in tax increase
Assume: School Districts Tax Base changes CONSIDERABLY School District at 20 mill floor School District has Debt Service Levy of 2.6 mills That budget commission reduces debt service levy by 1.6 mills Before After 25 25 20 20 15 15 10 10 Outside Outside Inside Inside 5 5 0 0 Similar to LH Situation but NOT exact- Essentially no change in net tax.
What a half mill reduction/increase would mean Value of Home Assessment Assessed Tax Valuation Millage Reduction/Increase Gross Tax Reduction Homestead/Rollback Impact (12.5%) Net estimated tax reduction per $100,000 value $100,000 X 35% $35,000 X 0.5 $17.50 -2.19 $15.31
Thank You and Questions It is highly recommended that the Board take action to approve the related resolution this evening. The result will provide continued funding for the permanent improvement needs of the School District at minimal net cost to the School District s taxpayers. A win-win-win for all involved the students, School District and School District s taxpayers
Recent Social Media participant stated closely look at Districts surplus to see if this inside millage shift is clearly required. School District s General Fund carryover cash balance has been declining: Cash balance at 7/1/15 FY 2016 Surplus FY 2017 Deficit FY 2018 Deficit FY 2019 Deficit Cash Balance at 7/1/19 $8,516,945 +926,400 -432,403 -1,049,080 -1,558,421 $5,573441 Perm Improv Unencumbered (Uncommitted) Carryover Fund Bal at 6/30/19: Bus Purchase (003 9194) Athletic Turf/Video Board/Track (003 955A) Textbooks (003 9905) Technology (003 9910) General (003 9999) Total Available at 7/1/19 0 0 27,246 26,718 3,594 $57,558 CONCLUSION: NO CURRENT SURPLUS EXISTS / INSIDE MILLAGE MOVE IS CLEARLY REQUIRED
