The Osseo Area School Board approved its 2017 levy Dec. 13. The total property tax levy is $90 million, a $5.6 million or 6.7 percent increase over the 2016 property tax levy. This results in an estimated $3 yearly increase for typical-value homeowners, bringing total taxes paid to the district to an estimated $1,316, assuming there is no increase in taxable value on a property over that year.
Assuming a 4.9 percent increase in taxable value over that year increases the tax burden for the typical-value home to $69 per year. In this example, the typical-value home is worth $250,000 for both 2016 and 2017 taxes. These estimates were prepared by Ehlers and Associates.
The tax capacity rate for 2017 is 26.679 percent, as opposed to 26.263 percent in 2016, 27.156 percent in 2015 and 29.819 percent in 2015.
The levy was approved in a 3-2 vote, with Boardmembers Jessica Craig and Dean Henke dissenting. Boardmember Robert Gerhart was absent.
Henke motioned to amend the levy, reducing the inflation portion of the referendum levy authority by $1 million.
“The state is obligated by state statute to fund education,” he said. “My truth, what they have done in years past is they are shifting that authority to local school districts to increase the levy in their specific school districts to fund the schools,” Henke said.
He added that he would like to shift some of that burden back to the state and off taxpayers. The district has a large fund balance this year and could afford the cut, he said.
“Not having that support from the state, it’s kind of like a rock in my shoe, that we’re taking that money out of the general fund to support that,” said boardmember Jim Burgett. “So, even though I understand and commend you for considering our taxpayers in that respect, I think until the state starts providing the funds, I will continue to support the maximum levy.”
Henke’s motion to amend the levy did not receive a second and failed.
Paul Ferguson, a resident living in the district, spoke against raising the levy during the truth-in-taxation portion of the meeting. He said the public needs to hear more specific information on district spending. For people living in the district without children like himself or who are elderly, the rate is too high, he said.
“I’ve had my taxes go up every single year since I’ve owned this house – the last five years” he said. “A third of my bill is for this levy, and it upsets me,” he said.
“Nobody’s talking about how you’re going to cut down expenditures,” Ferguson said. “I’m not happy about how all this is going down.”
Henke said more specific budget information is available on the district website.
The property tax levy provides revenue for three of the districts funds: the general fund, the community service fund and the debt service fund.
The general fund levy totaled $69.3 million, a $5.3 million or 8.3 percent increase from 2016. In the general fund, levy revenue from a voter-approved referendum totaled $34.4 million, a $2.1 million increase from 2016.
The community service fund levy totaled $2.5 million, a $147,826 or 6.2 percent increase over last year. At $18.1 million, the debt service fund levy increased $194,682 or 1.1 percent increase.
The district budgets for state aid covering $178.9 million or 69.9 percent of general fund revenue. Another $14.8 million or 5.8 percent comes from state aid for special education. In total, state aid accounts for 75.7 percent or $193.7 million. Property taxes cover $47.3 million or 18.5 percent. Federal aid totals $9.5 million, or 3.7 percent of general fund revenue. The remaining 2.1 percent or $5.3 million come from various other sources.
Student instruction represents the largest portion of budgeted district expenditures, totaling $108.8 million, or 41.9 percent of general fund expenditures. Special education instruction expenditures total $40.1 million, or 15.5 percent of general fund expenditures. Likewise, $219.8 million 84.6 or percent of budgeted spending goes towards personnel, with 62.6 percent or $162.6 million budgeted for salaries and $57.2 or 22 percent for benefits.
Instructional support services are budgeted $16.7 million, or 6.4 percent of total expenditures. Nearly 7 percent or $17.6 million has been budgeted for transportation. Direct support services account for $5.5 million or 2.1 percent of district spending. Administration represent another 3.4 percent, or $8.7 million of expenditures.
The district’s budget accounts for $31.4 million, or 12.1 percent of general fund expenditures.
Supplies and materials have 2.6 percent or $6.8 million of the budget. Capital gains cover a small portion of the budget, with $486,479 or .2 percent of total expenditures.
A change in the tax levy does not necessary determine a change in the district’s budget, said Patricia Magnuson, executive director of finance and operations for the district. The tax levy is also based on many state determined formulas, she said.
Contact Kevin Miller at [email protected]