Mercer Island board hears detailed briefing on proposed EP&O levy authority and homeowner impacts

Mercer Island School District finance staff on Thursday briefed the School Board on proposed authority to seek Educational Programs & Operations (EP&O) levy capacity for 20272030, explaining legal constraints, likely homeowner impacts and the districts recommended approach.

Lede: The district detailed why it seeks authority for a multi-year EP&O levy, how the 2019 levy-lid rules (the lesser of $2.50 per $1,000 assessed valuation or $2,500 per pupil FTE) affect Mercer Island, and what changes in state law could mean for local collections.

Nut graf: Finance staff (Matt) told the board that Mercer Island historically hits the per-pupil cap due to high assessed value per pupil; the legislatures recent adjustments to levy formulas and inflation indexing (including discussion of House Bill 2049) change potential levy collections and argue for an agile multi-year levy request. Staff presented several ceilings and rate scenarios, estimated homeowner-dollar impacts, and the calendar and county deadlines for placing a February 2026 levy request on the ballot that would take effect in 2027.

Key points: - Levy-lid mechanics: The district typically is capped by the per-pupil calculation rather than assessed valuation; the 2019 levy-lid reform and subsequent inflation adjustments alter the effective levy capacity. - Proposed authority: Staff proposed seeking multi-year levy authority (20272030) with staged ceilings; examples shown included rate changes and sample homeowner impacts (staff cited an example of 15 cents per $1,000 assessed valuation equating to roughly $330/year on a $2.2 million home). Staff also modeled alternative ceilings for 20282030 under assumed enrollment and inflation rates. - Timing and legal mechanics: The board was reminded that a levy placed on the February ballot requires county filing by early December; a levy-hike authority would be a simple-majority vote (unlike a bond) and districts commonly request four-year levies. - Policy tradeoffs: Board members discussed whether to request full allowable authority (to preserve flexibility and capture future statutory increases) or to request a smaller step-up approach to avoid leaving taxpayer capacity unused. Staff noted that past conservative ceilings left revenue on the table when legislative changes increased allowable collections.

What the board directed: Staff will continue to refine levy authority scenarios, clarify homeowner impacts, and present final recommendation and first/second readings consistent with county deadlines. The board scheduled additional review and public-facing factual materials for voters.

No formal vote on levy authority occurred at this meeting; the board set a timeline for hearings and resolution votes ahead of the December county filing deadline.