District 16 approves 4 percent increase in property tax levy

Spring Lake Park District 16 has approved the district’s final property tax levy at $20.2 million.

Spring Lake Park District 16 2012-13 general fund expenditures  Source: District 16
Spring Lake Park District 16 2012-13 general fund expenditures. Source: District 16

The district also held a Truth in Taxation hearing at its Dec. 18 regular school board meeting.

The tax levy payable in 2013 is a 4 percent increase or $781,024 more than last year’s property tax levy of $19.4 million.

The increase is because of enrollment, scheduled increases in principal and interest payment on debt, and abatements, according to Amy Schultz, District 16’s business manager.

Regarding abatements, school districts receive taxes based on enrollment and expenditures and not on property values. Taxpayers have the opportunity to challenge taxable property values set by the county. If the county lowers a resident’s property value, that in turn decreases his/her taxes. Subsequently, the change lowers the amount the school district receives for the next year. The amount is then added back in and spread to all taxpayers the following year.

Spring Lake Park District 16 2012-13 general fund revenues. Source: District 16
Spring Lake Park District 16 2012-13 general fund revenues. Source: District 16

“This year we had a large abatement,” said Schultz, Many District 16 property owners had their property tax values adjusted, she said.

The school board in September approved a maximum tax levy allowing for more flexibility in adjusting levy amounts.

The board decided not to levy the full amount that it had authority to do in order to limit the increase to taxpayers, Schultz said in an email to the Life. “The decision was made to reduce the allowable levy by $100,000,” she said.

Truth in Taxation

State law requires school districts to hold a Truth in Taxation hearing. The hearing must include a presentation of the current year budget and the proposed tax levy. Time is allowed for public comments.

No one came forward to speak at District 16’s hearing.

However, before the start of its regular school board meeting, District 16 sets aside a time slot for residents to speak to the board and administration. One resident came forward at the Dec. 18 meeting. He was unhappy with a hike in his taxes, he said. He noted his child did not attend District 16 schools.

Board Chairwoman Colleen Vranish referred him to Schultz for further explanation.

Total budget

District 16’s 2012-13 total revenue budget is $64.8 million and total expenditure budget is $61.7 million.

In a further breakdown by funds, the total revenue budget comprises the general fund, $50.1 million or 77 percent of the total budget; debt service, $9.4 million (15 percent of budget); community service, $2.7 million (4 percent of budget); food service, $2.2 million (3 percent of budget); OPEB (Other Post-Employment Benefits) debt service, $320,140 (1 percent of budget); and trust and agency funds,$100,000.

Total expenditures funds for the 2012-13 school year comprise general, $50.9 million or 79 percent of the total budget; debt service, $8.6 million (13 percent of budget); community service, $2.6 million (4 percent of budget); food service, $2.2 million (3 percent of budget); OPEB trust, $295,220 (1 percent of budget); and trust, $100,000.

The district’s unassigned fund balance, the portion of the fund balance not required by state law to be spent in a specific area, is $6.6 million, according to Schultz.

“We are fortunate to have a healthy fund balance at this time,” Schultz said in the email.

General fund

General fund revenues for 2012-13 are $50.1 million or 77 percent of the district’s total revenues.

The 2012-13 revenue resources include the state at $35.1 million or 70 percent of the general fund budget. Other general fund revenue sources are: federal, $1.5 million (3 percent of budget); levy $12.9 million (26 percent of budget) and other, $550,000 (1 percent of budget).

General fund expenditures are $51 million or 79 percent of total budget expenditures.

Compensation makes up the largest portion of general fund expenditures at $39.9 million or 78 percent. Other expenditure funds are purchased services, $6.3 million (12 percent of budget); supplies and materials, $1.4 million (3 percent of budget); capital $2.9 million (6 percent of budget); and fiscal and other costs, $481,610 (1 percent of budget).

Total levy by fund

The 2013 payable property tax levy is $20.2 million.

In a further breakdown, the levy includes a general fund of $10.2 million, a 5.98 percent or $573,519 increase over last year’s numbers; community service fund, $461,966, a decrease of 0.36 percent or $1,668; debt service, $9.3 million, an increase of 2.3 percent or $208,363 and OPEB debt service, $309,741, an increase of 0.26 percent or $810.

District 16 began planning the FY 2013 budget back in spring of 2011.

The budget is continually reviewed throughout the school year.

Budget revisions will be brought before the board for approval in February or March 2013, according to Schultz.

“With the growth in enrollment our district has seen over the past few years combined with structural budget decisions made by the school board in recent years, our district is in a strong financial condition,” Schultz said. “This positions us to make strategic decisions moving forward.”

Refunds available

Refund programs are available to a number of Minnesota taxpayers.

A Minnesota property tax refund, called the Circuit Breaker, is available to homestead property owners with an annual income of about $100,780 or less. For those with dependents, the income limit is higher. Maximum refund is $2,460. Taxpayers would need to fill out state tax form M-1PR.

A special property tax refund with no income limits is available for homestead properties with a gross tax increase of at least 12 percent. The increase must be $100 more than last year’s.

The refund is 60 percent of the amount by which the tax increase exceeds the greater of 12 percent or $100. Maximum refund for the special property tax is $1,000. Taxpayers opting for this type of refund would also file state tax form M-1PR.

Senior citizens can opt for a property tax deferral.

People more than 65 years of age with an income of $60,000 or less qualify for the tax deferral program. Taxes paid in any year are limited to 3 percent of the household income for the year before entering into the program. The amount remains the same in future years. Additional taxes are deferred, but they are not forgiven. The state charges an interest rate of up to 5 percent per year on deferred taxes and a lien is attached to the property. Deferred property taxes with accrued interest are paid when the home is sold or upon the death of the homeowner.

District 16 serves 5,300 students in Spring Lake Park and parts of Blaine and Fridley.

For more information on District 16’s 2013 property tax levy and 2012-13 budget, visit the district’s website at www.springlakeparkschools.org.

Elyse Kaner is at [email protected]