Levy Facts, Questions and Answers

Transcription

1 Levy Facts, Questions and Answers ~What kind of a levy are we running on May 7, The Amanda-Clearcreek Board of Education voted on February 4, 2019 to proceed with an 1% Traditional Income Tax Levy to be on the ballot, May 7, ~What is a school district income tax? It is an income tax, separate from federal, state and municipal income taxes, that is earmarked specifically to support school districts. A school district income tax must be voter approved by residents of the school district in order to be implemented. There are 2 different types of income tax - traditional and earned. ~Who pays the tax? A. Any individual residing in the State of Ohio who lives during all or part of a tax year in a school district that levies the tax. A part-time resident must pay the school district income tax based upon income received during the portion of the taxable year that he/she is a resident of the school district. Workers who are not residents of the school district do not pay the tax. B. For a traditional base tax only, an estate of a decedent who, at the time of their death, was domiciled in the school district. The tax is on the income earned by the estate after the time of death. Estates are not subject to the earned income based tax. ~Who gets taxed with Traditional Income Tax? Please consult your tax consultant or review the 2018 Guide to Ohio s School District Income tax prepared by the Ohio Department of Taxation for more in-depth descriptions of the traditional tax base. The following list is a general list of income taxed and not taxed with a traditional income tax:

2 ~How does the school district income tax affect farmers? A school district income tax would generally benefit farmers who bear a large share of the property tax burden in many rural school districts. Unlike a property tax, a tax on income is reduced when the farm profits fall. Payments for the income tax may be spread throughout the year by making estimated payments or possibly through withholding from farm income, as opposed to the property tax that is payable twice a year. ~How is the tax collected? The school district income tax is collected in the same manner as the state income tax: through employer withholdings, individual quarterly estimated payments and annual returns. Please know that the school district does not collect your taxes, nor do we know how much tax you as an individual pays. The state collects the taxes and then disburses it to the school district.the School District tax filing number is ~Why do we need this levy at this time? The fact is that decreased annual revenue results in additional reductions in staff, programming and operations as a whole. Even with the $1.2 million dollars in cuts made for the school year along with the, our district will be deficit spending this year by $2.1 million dollars. Deficit spending means we are spending $3 million dollars more than what we are bringing in this school year. As I am a visual person, I have attached a graph that shows our deficit spending and the necessity of this levy. ~What is a Five-Year Forecast? The forecast is a living document that is used as a planning tool for our school district and community. It is a living document because it is updated each month with our actuals. It is a five-year projection of school district operational revenues and expenditures, which is based on a snapshot of today and is adjusted to reflect all known activities of the future. Our district also prepares assumptions to go along with the forecast. Our assumptions explain what the numbers on the forecast are and how we came to those numbers. A Five-Year Forecast is

3 mandated by Ohio law. The board approves the Five-Year Forecast every October and May. You can find our forecast on the district website under the Treasurer s tab. There you will also find our assumptions, a document on how to read a Five-Year Forecast, and a link to ODE s website to view all Ohio school district forecasts. ~How much money does the traditional income tax generate for the Amanda-Clearcreek Local School District? The 1% Traditional income tax will bring in $2,045,026 per the State Department of Taxation. ~When will we taxpayers start paying this tax when passed on May 7, 2019? January 1, 2020 ~When is revenue from the income tax received by the school district? If passed this May, the tax becomes effective on January 1, The first payment will be received by the school district in April Districts receive four payments per calendar year, one each January, April, July and October. Each payment will be for the amount collected during the prior quarter. The state retains 1.5% for state administration fees. ~Will we collect the full amount beginning in 2019? No. If the levy passes in 2019, collection does not begin until January 1, Therefore, no money will be collected from taxpayers in 2019 and no income tax money will be received by the district. ~Will we collect the full amount in 2020? No. Collection of this income tax will start in January 1, Payments start slow, due to the income tax not fully being withheld by every resident. Many residents will choose quarterly, semi-annually or annual payments. We anticipate receiving approximately $740,657 by December 31, January 2020 payment covers the period of Oct/Nov/Dec $0.00 estimated April 2020 payment covers the period of Jan/Feb/March $120,657 estimated July 2020 payment covers the period of April/May/June $290,000 estimated October 2020 payment covers the period of July/Aug/Sept $330,000 estimated ~When will we begin collecting the full amount? Think of a levy as a hill; it takes time to get to the top. It will take approximately six quarters (1 ½ years) for a district to receive the full amount of taxes liable from the first year it is levied due to how the tax is collected. Employer withholding comes in throughout the year, but individual annual returns are not due until the following calendar year. Our first full year of collection will be the school year.

4 ~How do the taxes that are paid in the Amanda-Clearcreek compare with other school districts in Fairfield County? School District Tax Comparisons: ~What is a Cash Balance? It is the total amount of money in an account. It is calculated by adding all revenue to what cash you started out with and deducting all disbursements or payments made. A cash balance can be positive, if money is available; or negative if the account has been overdrawn. Example: On March 1st, you have $100 cash in your checking account. You get paid $1,800 for the month. Between your bills, gas, grocery and other items, you spent $1,850 for the month of March. That means, that your cash balance on March 31st is $ That is what you have left in your account. $ $1,800-$1,850=$50.00

5 ~What is the difference between cash balance, carryover and savings account? Cash balance is what you have left in your account at a certain time period. (See explanation above) Carry over is something that is carried over, postponed, or extended to a later time. So in the example above, you carried over $50.00 into the next month in your checking account. A savings account is an account provided by a bank for individuals to save money and earn interest on the cash held in the account. A savings account can be used to save money for specific expenses/projects and is usually not used for everyday expenses. Because it is not used for everyday expenses, it generally has a higher interest rate than your checking account. In the example above, the $50.00 is not in a savings account. You could pull that $50.00 and put it into a savings account, but it would not be in your checking account to be able to pay for your everyday expenses. The school district operates the same as your household finances. We operate on a fiscal year. A fiscal year is July 1-June 30. Our cash balance is what we have left at the end of the day on June 30. If we have a positive cash balance, then we carry that cash over to start the next fiscal year on July 1. The district does not have a savings account. We do invest money in CD s so that we can get higher interest rates on that money when we have money that is above what we budgeted for that year. The money we have invested in CD s mature at different dates, so that we can plan for projects or lull s in funding. The district will usually earmark interest we receive off of these CD s for projects. Recently, a CD matured and we receive approximately $15,000 in interest. We earmarked that interest to help with resurfacing the track and put it into the permanent improvement accounts. ~What is deficit spending? Deficit spending is when you spend more than what you receive. ~What has the Amanda-Clearcreek Local School District done to reduce costs or cut spending? The District is always looking to operate as cost effectively as possible. One example of this is that the District belongs to consortiums (shared services) for purchase of insurance, utilities, school buses, operating supplies and other miscellaneous services to leverage our purchase pricing and terms. Did you know that a 5-year copier contract negotiated in 2013 shows a savings of $57,000 each year of that contract? We re-negotiated that same copier contract and are saving approximately $25,000 annually with the new contract. In addition, as contracts come up for renewal, they are negotiated to see if there is a savings potential. For the school year, the district re-negotiated contracts to save $82,381. The district entered into a contract with Evans Energy to complete an energy savings project that involved replacing all lights on campus, with the exception of the stadium lights. LED lights have now been installed in all campus lights, externally and internally. By implementing this project, the district will save $92,000 annually. The tables below show savings/cuts that have

6 been made to our operating fund the past couple of school years and include potential savings that will be implemented for next school year. ~What are Per Pupil Expenditures compared to the State Average? FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 AC Expenditure Per Pupil $8,109 $8,349 $9,293 $8,802 $7,876 $8,219 $7,791 $7,957 $8,908 $9,752 $10,513 Statewide Average $9,343 $9,623 $9,991 $10,254 $10,565 $10,697 $10,597 $10,446 $10,913 $10,985 $11,164

7 ~How much has state & federal funding dropped over a 5 to 10 year period? State Funding school year 67.2% state share school year 67.2% state share school year 60.7% state share school year 60.7% state share school year 57.5% state share school year 57.4% state share Federal Funding school year $1,131, *Includes Ed Jobs Grant school year $723, school year $732, school year $668, school year $743,726, school year $649, school year $612, school year $538, ~Does the school district receive any grants? Yes! Besides the $538, in Federal grants above, the district and staff members have applied and been awarded various grants. Here are some examples: LOCAL/STATE GRANTS *Straight A *Pine Grove Host *Ancestory Grant *Hosler Trust *Memorial Trust *Americorps 4-YEAR TOTAL $407,249 *Farm to School *Fast Grant *South Central Power *School Safety Training *OSFC School Security *BWC ~Who paid for the new bleachers for the football field and what was the cost? The Board of Education paid for the bleacher project. This project included the removal of the old bleachers, installation of new bleachers, new fencing and stone and seed, and various electrical boxes/supplies and other supplies to complete the project. Total cost was $276, which did not include all of the volunteer work community members put in to help with the removal and finishing of the project. Approximately $30,000 of the total came from our Beverage Contract with Pepsi. ~What was the purpose for the new bleachers? The homeside bleachers were not ADA compliant and did not pass a safety inspection.

8 ~What does the 1:1 technology mean and how much does it cost? Our goal is to provide a device to every student K-12 to ensure that all students have access to high-quality content and instruction that will expand the learning environment then we will improve student learning and narrow the achievement gap for all students. 1:1 technology means that every student at AC has either a chromebook or an IPad. The district has invested approximately $1,250,000 over the past 5 years on new and replacement of computers, IPads, Smartboards, district technology infrastructure, 1:1 chromebook project and wireless technology at the Primary building. In order to help sustain the 1:1 technology project, the Board of Education has earmarked the reimbursement settlements received from the Ohio Department of Medicaid to go towards this project. The Settlements have covered all of the supply and equipment expenses so far, but the district will need to look at the sustainability of this program past Below are the expenditures for the 1:1 Chromebook Initiative through our current school year: ~When students take classes at OU-L does it cost the district money? Yes. Those students who choose to participate in College Credit Plus are still our students, therefore we are financially responsible for them. There are different costs depending on how they get their instruction, either on a college campus, on our campus or online. On average, a semester hour costs $ if the college course is deliver on the college campus. Most classes are anywhere from 3-4 credit hours. Most of our students take anywhere from 1-4 college credit classes. The district would pay approximately $1, for a student who takes 3 college classes (3 credits each class) in a semester. ~When I look at my tax bill, it appears that my taxes have went up a great deal. Why have they went up so much? Does the school benefit from this because it appears as though the majority of it goes to the school? The County Auditor appraises all taxable property once every six years which is called reappraisal. There is also a re-appraisal every third year more or less as an update. The millage rate is then determined for the school district. Local property tax rates are always computed in mills. There is inside millage that is set up by the Constitution of the State of Ohio and doesn t have to be voted on. It is limited to 10 mills which gets spread out to public schools, cities, counties, and other local governments. There is also outside millage which has to be voted on by the public. The reason the millage rate is determined is due to HB920 which has been in effect since This bill freezes all voted property millage at the dollar amount

9 collected the first year the voted millage went into effect. This Effective millage can never bring in more money for the schools than when it was 1st passed. We currently have 37.3 mills for the school district. It is broken down like this: Voted Rate Effective Rate General inside mills General outside mills Bond *Expires (voted on to build our schools~it pays our mortgage ) Classroom facilities *Expires (to help with maintain the buildings) Your tax bill shows the full amount of what you pay in property taxes at the effective rate. Your bill is calculated on the assessed value of your property, which is 35%. For example, if the market value of your property is $100,000, then you will pay property taxes on $35,000; if the market value is $400,000 then you will pay property taxes on $140,000. So where does your property tax money go? The graph below represents the amount of money from each dollar going to the various entities. The taxing district used for this graph is Taxing District 3 which incorporated the Village of Amanda. Your specific amount will vary depending on which tax district you live within.

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