Edwardsville District 7 voters will not see a question about $10 million in bond sales on the March ballot, but they will be asked for a permanent tax increase in November.
The District 7 school board had sought to issue up to $10 million in working cash bonds for operating expenses over the next two or three years to make up for state funding that has been withheld or eliminated. Those bonds do not have to go to the voters, unless a petition is filed with at least 10 percent of registered voters in favor of the vote.
That petition was delivered to District 7 offices on Dec. 11, and thus the bond sale would have to appear on the ballot to be approved.
At Monday’s school board meeting, District 7 leaders opted not to try for working cash bonds. Instead, the board is looking to a long-term, permanent solution to the budget deficit by putting a property tax increase on the November ballot.
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“The board and the administration have reevaluated the situation based on feedback from parents and other community members, and we have decided that it’s time to consider asking our constituents for their support of an education fund tax rate increase,” said Superintendent Lynda Andre.
The estimated impact of the working cash bonds would have been 10 cents per $100 of equalized assessed value over a 10-year period, or about $50 a year for a house valued at $150,000. The amount that the permanent education fund increase will cost has not yet been determined. Andre said the district is conducting an analysis of financial needs in order to determine how much of an increase would be needed to secure District 7’s financial future.
“Rather than ask voters to approve a short-term solution, the board decided it is in the district’s best interest to consider the pursuit of the long term solution,” said board president Monica Laurent.
Until recent years, Edwardsville was able to avoid the budget problems of other school districts because property values were increasing in District 7 by as much as 10-12 percent each year, and the district had $8 million in its surplus working cash fund.
Meanwhile, money for many programs has been cut or eliminated, the state now pro-rates its payments to schools by 11 percent each year, and property values in Edwardsville have leveled off from their previous rate of increase.
Finance director Dave Courtney estimates the district is shortchanged about $7 million a year from the state, and has cut transportation and special education money as well. In 2008, the state gave District 7 $16.7 million, including $5.7 million in transportation and special education. This year, the state will give District 7 $9.5 million, including $3.4 million in transportation and special education. Meanwhile enrollment has risen from 7,379 in 2008 to $7,504 this fall.
District 7’s education fund tax rate is $2.15 per $100 of equalized assessed value, with a total district tax rate of $4.15 per $100. The education fund rate has not been increased since 1977, and according to figures provided by the district, it is one of the lowest rates in Madison County: Triad, Granite City, Collinsville and Highland have education fund rates ranging from $2.34 to $2.55.
The tax rate increase would also be accompanied by another round of budget cuts. Andre estimated that District 7 has cut $12 million from the budget since 2008, including eliminating staff and cutting the vocational program. More cuts will take place for the 2016-17 year, as well as considering fee increases.
“We need to be sure we’re doing everything we can to minimize the amount we need from the taxpayers,” Andre said.
But Courtney estimated in order to make up for the lost revenue from the state on budget cuts alone, they would have to fire 80 teachers, and that is not a consideration.
“This board highly values education, and now is the time to consider the pursuit of its long-term plan to ensure the financial stability of District 7,” said Jeff Miller, vice president of the school board and chairman of the finance committee. “Rather than pursue a short-term solution, the board and administration will continue to evaluate the right balance of further expenditure reductions, fee increases and the consideration of an education fund tax increase.”
District 7 has had successful referenda in the past to fund construction projects such as the new elementary and junior high schools in east Edwardsville. Those projects were supported by large grassroots volunteer groups of parents and community members who walked in the Halloween parade and knocked on doors to spread the word about the vote.
Andre said they plan to use similar strategies for this referendum. “We’ll be using the summer months organizing volunteers as we’ve done in the past,” she said. “We have a very involved base of parents.”
Andre said due to the holiday season, they have not seen much reaction yet from the community, but some board members have received positive feedback.
If the referendum were to pass in November, the higher tax rate would go into effect the following year, so the district would not receive money until the 2017-18 school year. The school board will have to vote by August to officially place it on the ballot with the amount requested.