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Board hears warning about proposed state property-tax changes that could cut district revenue
Summary
Board members and the treasurer warned that a state House proposal to overhaul property taxes could reduce Lebanon City Schools' revenue by roughly $1.7 million annually and that carryover restrictions under some proposals would affect district reserves.
Board members and district financial staff used the June 16 meeting to warn the public about a pending state proposal described by the board as a sweeping property-tax reform bill and its potential local impact.
Board member Cope reported on a currently circulating House bill she identified as "House bill 3 35" that would change how property taxes are levied and said the district has been actively contacting legislators. Treasurer Karen (last name used in meeting) gave an estimate the change "could be upwards of 1,700,000.0 in a year," a figure she said depends on which provisions are approved.
Cope and the treasurer described several provisions that would affect the district: elimination of "inside millage," a constitutionally established share of unvoted mills used to fund local services; restrictions on the ability to place substitute or emergency levies on the ballot; and proposed limits on the amount of operating carryover a school district may retain. Cope said the House version under discussion would cap carryover at a level she characterized as the equivalent of "3 months" in one description while the senate version discussed at the meeting used a percentage-based cap (described as 30% or 50% in different versions).
Treasurer Karen told the board the district's current five-year forecast shows an expected five-year carryover that may end near $15,000,000 in total cash balance and said the district is monitoring the situation closely. She warned that if the house proposal is amended into the final budget, the district could face a large revenue shortfall and might need to consider a future levy: "We could potentially lose 1.7," she said when describing the annual figure discussed earlier.
Board members and the superintendent urged the public to contact state legislators during the conference committee process; Cope encouraged residents to "educate yourself and reach out to legislators" while noting the conference committee will reconcile differences between the House and Senate budget plans in the coming weeks.
Why it matters: The district's operating budget depends substantially on property-tax revenue; committee or budget changes at the state level could materially affect local school services and levy planning.
No formal board vote or binding action on state legislation occurred; the item was informational and a call for public engagement.
