9-12 Get Your Message Out

9-12 Get Your Message Out

Tax rate votes testing school leaders’ skills at explaining decisions

By Brad Hughes
KSBA Member Support Services Director

For more than a half century, people have mimicked Cuban-born Desi Arnaz from the I Love Lucy TV series with a Spanish accented, “Lucy, you got some splainin’ to do.”

Only Arnaz never said that line in the show’s eight year history. Much like “Beam me up, Scotty,” it’s one of those quotes attributed to but never uttered by the original character. It’s an urban myth.

Well, it’s no myth that Kentucky school board members are having some splainin’ to do this fall as they cast their votes on 2013 school tax rates.

Over the last few years, anti-tax advocates increasingly have made their voices heard. But recently, media reports are noting a new group speaking out – teachers strapped for classroom resources, classified workers with heavier workloads as their numbers dwindle, and parents who fear ominous consequences for their children.

These factors – plus an election year for hundreds of board incumbents – are making the public spotlight even brighter this fall on board members’ votes and their explanations.

Lessons in recent history?
While economists argue whether the global recession is now slowing or stuck in place, they tend to agree that it began at the end of 2007. Research by KSBA’s Governmental Relations staff found some interesting trends in recent school board tax decisions in data reported to the Kentucky Department of Education.

• In the prerecession fall of 2007, 107 boards – 61.5 percent of the 174 boards – took the full 4 percent revenue increase without facing a potential voter recall. By fall 2011, 72 boards opted to collect the maximum revenue – down to 41 percent of the districts.

• Five years ago, 27 boards took the compensating tax rate. Last year, that statistic leaped to 62 boards – from 15.5 percent of the total districts to 35.6 percent.

Kentucky defines the compensating school tax rate calculation as “prior year revenue from real property divided by current year total valuation of real property rounded to the next higher 1/10th cent OR prior year revenue from real property plus prior year revenue from personal property divided by current year total valuation of adjusted property at full rates rounded to the next higher 1/10th cent, whichever shall be higher.”

In layman’s language, the compensating rate is designed to produce revenues equal to those of the preceding year. Depending on local property valuation (which varies widely from district to district), the compensating tax rate could be higher or lower than the previous year’s rate.

• From 2007-08 to 2011-12, 29 boards chose to take the maximum 4 percent revenue growth each of those years, while another seven adopted the compensating rate each year.

• In varying years during that same time span, between 28 and 41 boards increased tax revenues through options ranging from a voter-recallable tax increase to a pair of tax options known as Subsection 1 and House Bill 940. (If you want those explained, ask your district finance officer.)

The bottom line is that, while fewer Kentucky boards have taken the maximum revenue increase over these five years, more than half of the 174 boards every year had to raise local taxes to balance their budgets.

In news stories last fall, a few board members offered clear messages about their decisions.

Some pointed fingers at Frankfort and Washington, D.C., for reductions in school funding or new, costly, unfunded mandates. They made the case that lawmakers passed the budget-balancing buck to school boards, while boasting, “We didn’t raise your taxes.”

Some made the case that raising tax revenues in the middle of hard economic times isn’t right for their constituents. Many district leaders heard those messages in last year’s public hearings and board meetings: “Live within your means. Cut your expenses. Just don’t raise our taxes.”

Still others echoed points such as these put forth by the Kentucky Education Action Team. “SEEK has fallen from $4,230 per pupil in 2007-08 to $3,769 in 2011-12. Preschool funding has dropped more than $900 per child. Districts that need to replace outdated textbooks must do so using local funds - again.”

The Last Word
Historians tell us that the first recorded tax was instituted by Egyptian pharaohs around 2390 B.C. In all that time, I’m betting that no official has ever said, “This is a good time to raise taxes.” There’s never going to be “a good time” to raise taxes. Local, state and national situations always will dictate the necessity of the tax rate decisions.

Already this fall, Kentucky school board members are facing conflicting demands as they set their 2013 tax rates.

Leaders who put into plain words their considerations and comprehension of the repercussions of those votes – on taxpayers, on teachers, on administrators, on custodians and on students in the classroom – will have a solid act of public service to them all.

And that’s a message worth getting out.

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