Senate passes bill requiring school board opt-outs be referred to voters

The Senate passed Senate Bill 208, a measure that requires school boards to refer proposed opt-outs from property-tax limits and capital outlay certificates to voters. Sponsor Senator Peterson (Petersen in transcript) said the change fills a gap where counties already must refer opt-outs to voters while school boards currently may opt out administratively.

Petersen argued the bill restores taxpayers' direct consent for tax increases above statutory limits and cited data that from 2019 to 2023 school districts opted out for about $165 million and issued capital outlay certificates exceeding annual funds by roughly $413 million, for a total of about $578 million beyond the statutory limit. He said requiring referenda ensures voters decide whether to allow spending above the limits.

Opponents, including former school-board members and current board advocates, warned the requirement would create costly off-cycle elections, force votes in time windows (July 15 to Oct. 1), and could impede boards' ability to make timely budget decisions such as hiring teachers before count day. Senator Wheeler and others recounted examples where short-term opt-outs were later repealed when enrollment counts made them unnecessary.

Senator Sauter and others said the bill would increase costs for districts by forcing elections and could prevent efficient use of capital outlay certificates that do not change tax rates. Senator Zickman and Senator Howard argued that property-tax relief requires more checks on opt-outs and urged support. Petersen closed by saying the bill is one component of broader property-tax reform and urged passage.

The Senate adopted final passage by roll call; the secretary reported 19 yeas, 15 nays, and 1 excused. The president declared the bill passed and the title was deemed correct.