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Orange City SD treasurer warns timing-related property-tax shortfall; levy still eyed for 2027
Summary
The district's five-year forecast shows lower-than-expected property-tax receipts this year attributable to reappraisal timing, higher delinquencies and increased tax refunds; officials said they expect some revenue to arrive in summer distributions and continue to plan for a possible 2027 levy.
Orange City SD Treasurer Todd Foster told the Board of Education on May 12 that the district collected materially less property-tax revenue than expected this year and has adjusted the district's five-year forecast to reflect that shortfall.
Foster said actual property-tax collections were $311,000 lower than last year and roughly $1.5 million below the district’s November five-year-forecast estimate. He told the board three factors appear to be driving the shortfall: the recent county reappraisal affecting payment timing, a rise in delinquency rates and an increase in tax refunds that the auditor’s office is processing.
The change is primarily one of timing, Foster said; he and board members said they expect some revenue to be recovered in July and August distributions and reflected that in fiscal year 2026 of the forecast. Foster also reported other positive revenue signals: public-utility values rose, homestead and rollback payments were near projections and the district received a Pinecrest income-tax sharing payment of $380,000.
Board members and staff discussed expense pressures as well. Foster said health-insurance costs rose 13% at the last renewal and the five-year forecast currently assumes a 10% annual increase; he said he hopes renewal rates will come in lower (he referenced an 8% to 10% range as possible but noted uncertainty). The district is also monitoring bus fuel and other operational costs and said recruiting and retaining staff remains expensive.
Board members raised policy and planning implications. Trustees discussed the district’s reliance on development and rising property values (including several local projects and a TIF that could add taxable value) as the primary non-levy way to increase revenue. Several trustees said deferring a new tax levy as long as prudently possible would be preferable; Foster said the five-year forecast currently shows a potential levy in 2027 but that timing could shift depending on the coming months’ receipts.
Foster told the board he will provide a fuller presentation at the May 27 meeting. The board did not take a formal funding action in this discussion; trustees asked for follow-up data on voucher funding transfers out of the district and on more detailed residency-versus-attendance breakdowns.
The discussion underscored the district’s view that current shortfalls are driven largely by timing and by broader economic conditions rather than an immediate structural collapse of revenues, but trustees said they will continue to monitor receipts and refine the forecast.
Ending: Foster scheduled a more detailed presentation for May 27 and said staff will continue to track tax collections and present updated levy-timing options to the board.
