Talk about fiscal restraint: the Madison Central School Board has decided not to take advantage of the opt-out it won at the polls last year. The Board voted 4-3 last night not to include the $250,000 allowed by the opt-out in its FY2008 budget. Superintendent Frank Palleria says that the tax revenues were higher and expenses lower than expected (we should all be so blessed). Outgoing Board President Kelly Johnson led the majority (including Mark Hawkes, Dennis Hegg, and David Zolnowsky) in voting against budgeting the opt-out funds, saying the projected budget doesn't show an immediate need for the funds. Board member Rod Goeman dissented, saying the real budget crunch is coming in years three and four of the opt-out, which justifies collecting the higher tax revenue from the opt-out now and putting it in reserves. Michelle Tucek and Craig Walker voted with Goeman against the no-opt-out budget proposal.
Now don't go spending your projected tax savings just yet. The Board passed its budget last night, but it has until October 1 to file its final tax levy request with the county auditor. If the fiscal picture or the mood of the Board changes before then, the district can still reverse its decision and ask for part or all of that extra $250,000 for the coming fiscal year.
I've given the board a hard time over its opt-out efforts, due largely to my opposition to our unjust property tax system. Still, after winning the $250,000 opt-out in 2005 (after two failed attempts in 2002), the Board has shown remarkable fiscal restraint. Voters authorized the Board to take an extra $250,000 each year for four years. The Board has every right to take that money and sock it away for a rainy day. Yet the Board has voted, in the absence of a compelling present need, to leave that money in taxpayers' pockets.
This action resembles that taken by the Lake Herman Sanitary District (of which I am a board member) this fiscal year. The sanitary district opted out a few years ago and was collecting an extra $3000 a year just to put in the bank in hopes of saving up for a major sewer project sometime in the future. However, seeing that even that rate of saving would not bring a sewer project to fruition in the foreseeable future, the sanitary district chose not to take opt-out funds this year and limited its tax levy request to it standard operating budget. Both the school board seems to be following the same logic, that government should not try to run a surplus.
Our man Hunter agrees: the Board deserves credit for resisting the temptation that most local governmental entities feel to tax at the maximum rate allowed by law. Now let's see if that fiscal restraint sticks through October.
I couldn't believe it that the school board isn't taking the opt out money after fighting for it for so long. Although I fought the first two opt outs, I thought this time the board had truly worked to cut expenses and needed the money. Maybe it should have taken the money and reinstituted field trips for elementary schoolers, or another band teacher at least part-time, or any other program it has cut in the last several years. I think that makes more sense at this time than not using the money.
ReplyDeleteI do not see higher tax reveneus have anything to do with the opt out money anyway. Fist of all, any opt out monies go into the general fund. For the genearl fund, the amount taken in by local taxes and the amount the state kicks in can only amount to X amount per student anyway. Readjustment of the tax levy is supposed to keep that ratio pretty stable. If local revenues are higher, then the amount of the state kicks is in less, and the total amounts remains the same at X.
Therefore, how would higher tax revenues generate more money in the general fund?
The capital outlay fund is a separate entity and IS growing by leaps and bounds each year due to higher tax revenues. That money goes to pay for new construction, buses, computers (I think) etc.
If anyone reading this knows how higher tax revenues resuls in more money to the general fund, please enlighten me.
If truly they don't use it from now to October, it would seem to me that they didn't need it in the first place. Or that they are trying to generate good will again for the school board by not using it; after all, they couldn't even get one person to run for the board this year. Or that the defeat of the proposed new gym made certain of the board members realize that people were truly sick of spending money on schools and this not taking the opt out money is hoped again to generate good will for the school and the board.
All in all, it's surprising and I really honestly do not understand. Am I being cynical? Probably. But I don't understand their increased tax revenues explanation.
News flash. A comment from my better half who just read this (and who happens to be even more cynical than me!).
ReplyDeleteThe reasoning behinid this: They are going to bring back the new gym proposal, and they are trying to generate good will in the community by not taking the opt out money. They can then say, "Look at us, we are being so responsible with your tax dollars. But now we really need a new gym, and since we have shown we are so responsible, you will of course support us."
Of course, if this is true, we will have to wait a few months to see if he's right. But it goes back to my same statement that the school district is trying to increase good will in the community.
And although the Madison Pride Committee was taking responsibility for the new gym project, it was undoubtedly supported and advocated for behind the scenes by the school board.
Oh, what a cynical readership I have!
ReplyDeleteMark Lee had a good letter in the paper. After fighting so long for an opt out and finally getting it, why not use at least some of the money to fund the programs that have been cut. Even though the school was evidently taking in more money, and they had to know that last year at the time they consolidated/cut the band and choir programs, they didn't see fit to use some of these funds (either the extra monies or the opt out money) to re-fund the band or choir.
ReplyDeleteHis point about the seats in the auditorium though is moot because I think that comes out of the capital outlay fund, as does a lot fo the technology stuff. And the high school is on the list for remodeling/renovation whatever as soon as the elementary school is paid for, according to the school district itself.
I can see Plan B emerging soon for a new gym. Will be glad to be wrong, but.....
Does it make a difference if the project is from the capital outlay fund or general fund when it comes to an opt-out. I thought (and could be wrong) that an opt-out could be used wherever. Maybe it depends on the language of the opt-out...
ReplyDeleteBut on that note, why not take some of the opt-out funds, do some of the stuff Mark Lee listed, and apply some of the funds to paying off the Elementary School. Think of how much interest we can save if we pay off $200,000 on that loan now.