Osseo School Board will seek two levies; Residential survey results were positive but board was divided over duration of proposed levy

BY JONATHAN YOUNG

jonathan.young@ecm-inc.com

After receiving favorable results on a resident survey, the Osseo School Board decided July 2 to ask voters to approve two levies this November. The board unanimously agreed to seek a five-year operating levy and a 10-year technology levy.

But the decision was far from painless.

All board members supported both levies, but the group deadlocked over the duration of the operating levy. Scheduled to end around 8:30 p.m., the work session dragged past 11:30. Board members struggled to suppress emotions as a standoff developed. Ultimately they all agreed to support the levies when a vote comes at the board’s meeting Tuesday, July 17.

WHAT THE SURVEY SAID

In May, Decision Resources conducted a survey on behalf of the district to determine voter attitudes toward the district and potential levies.

The firm concluded that public opinion of the district has improved since the 2007 survey and voters were likely to support levies.

According to the survey, 51 percent of those questioned said they would support or strongly support both a 10-year operating levy and a 10-year technology levy. Another 7 percent supported only the operating levy, and 7 percent supported only the technology levy. Only 31 percent opposed both, and 4 percent were unsure.

Decision Resources research director Peter Leatherman said starting with a 20-point advantage of supporters to opposition is unusual.

"The great majority in this district are persuadable," he said.

Leatherman also said the survey indicated a "moderately hostile tax climate" but found taxpayers believe they get good value for their school taxes.

When comparing the Osseo district to neighboring communities, 52 percent of responders said school taxes were somewhat high or very high. But 67 percent rated the value for the dollar as "good," and 6 percent said it’s "excellent." That’s compared to only 51 percent and 3 percent five years ago.

Public perception of the school board, administration and teachers also improved, according to the survey. Fifty-nine percent of responders rated the school board’s performance as "good" or "excellent," up nine points from five years ago. Similarly, 59 percent gave administration positive marks – up seven points – and 81 percent rated teachers positively, up four points.

Residents also felt more informed, the survey indicated, but the prevalence of communication "through the grapevine" surprised Leatherman and school board members. One third of responders said friends and neighbors were a major source of information on the school district. That was higher than any other source. And 49 percent said friends and neighbors were a minor source, higher than any other minor source.

"It’s odd for a third of people to say it’s a major source," Leatherman said. "It’s actually a very small-town result."

ABOUT THE PROPOSED LEVIES

If voters approve the operating levy in November, it will provide the district the maximum amount allowed by the state – $377 per pupil each year, or approximately $8.6 million annually.

Next school year, the district expects to operate at a deficit of about $8.8 million, and current projections show that deficit increasing each year. That means even with the levy, the district would face significant budget cuts in a few years. Current budget projections show the need for $11 million in cuts for the 2014-2015 school year.

If the operating levy passes, the owner of a $200,000 home will see school taxes go up about $14 a month. Funds would help maintain class sizes and program offerings.

The technology levy would provide about $5 million a year for tools to enhance student learning and teacher effectiveness, as well as for improving infrastructure. For the owner of a $200,000 home, school taxes would increase about $7 a month.

All board members agreed that in light of the district’s financial situation and the favorable atmosphere indicated by the survey, the district should ask for the full amount allowed by the state.

TENSION AMONG THE BOARD

State statute would permit the proposed levies to last no more than 10 years. Administration recommended going for a 10-year levy. Most board members felt a term of eight or 10 years was appropriate, because it would provide more financial stability.

Board Chair Dean Henke disagreed.

He said that by asking for a long-term levy, the board would take some pressure off the budget. In his opinion, the board needs that pressure to keep "comfortable tension" on the budgeting process. He said that’s the only way the district can fix what he sees as its structural problem of spending more than it takes in.

"We’re not structurally fixing what isn’t working in the district," he said. "We put levy on top of levy … We spend more than we take in. We’ve done that historically … It’s an underlying structural issue … We’ve slowed it, but we haven’t resolved it."

With current budget projections showing $11 million in cuts for the 2014-15 school year a "cliff" is looming ahead. That’s what Henke believes will keep the district focused on reducing spending to match revenue. He argued a long-term levy would make the cliff look smaller and would lessen the sense of urgency to fix the problem. He said he doubts significant changes would occur.

Director Teresa Lunt agreed with the idea of maintaining healthy tension but was willing to ask for a levy that would last as long as seven years.

Other board members seemed to prefer an eight- or 10-year levy.

"Let’s sustain it for as long as we can for the good of our kids," Director Laura Cottington said. "… It just seems the longer we can go, it does provide more stability."

"I think we do need extra funding while we’re trimming the budget," Director Jim Burgett said.

But the board agreed it needed all six members to publicly support the final decision, because research data from Decision Resources showed the chances of voters approving a levy referendum went down about a third if one board member voted against it.

Burgett, Cottington and Lunt seemed comfortable coming down to five years, as Henke suggested.

But the idea of a five-year levy made directors Tammie Epley and Kim Green nervous, because it would expire the same year as the district’s current operating levy, which provides about $24 million a year. That means the district would have approximately $32 million of revenue on the line in one election, probably in November 2016. If voters rejected the renewal in 2016, the district could still put a levy question on the ballot in 2017 before the levies expired.

"Then you run the risk of losing everything," Director Kim Green said. "… I don’t think I can go there."

"I feel like the tension is good," Epley said. "But I feel like we’re going to have that tension in four years when we have that $24 million levy renewal. But I think that both of these coming up together … is really scary."

Henke pointed out that combining both levy renewals would save resources, because it would only require one awareness campaign. He also noted the risk wasn’t as great as it seemed because the district would only be asking for a levy renewal, not a tax increase.

Epley said something unpredictable could happen before the levy renewal, and voters might say no because of bad timing.

"I really don’t want to put everything in one roll of the dice … because I’m afraid it might bring horrible consequences," she said.

Green said she was as philosophically opposed to the risk of a five-year levy as Henke was to a longer levy.

The meeting deadlocked, and it seemed as if the board might not agree on any operating levy.

"I think we have to do something, rather than nothing," Supt. Kate Maguire said. "Even if it’s five (years) … I think that the data shows that we have an unusual amount of community support right now that we really want to capitalize on."

"I have a really hard time walking away from the five years as well, even though I don’t think it’s what’s in the best interest of our kids," Epley said. "I’ll support the five years."

Eventually Green conceded as well, saying she’d publicly support a five-year levy instead of no levy at all, even though she didn’t consider it a wise risk.

"Do it," she told Henke. "You win."

After the decision, Lunt said she was pleased with the dialog the board had on the topic and that it was able to unanimously support both levies.

"This is what makes this board so good," she said.

The board will officially vote July 17 to put both levy questions on the ballot in November.

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