ST. PARIS – Graham Local Schools began the process to place a new income tax levy on the November ballot.
The board also approved a second resolution putting St. Paris Public Library’s levy on the ballot.
The school board unanimously approved the first of two resolutions for the school levy placement at its Monday meeting.
The tax would be an earned income tax operating expenses levy to raise $1,918,570 a year for five years. It is estimated to be a 1 percent income tax, though that will depend on auditor certification, Treasurer Judy Geers said.
An earned income tax levy is only for those who receive an income, Geers said. Retirees with no income would not be subject to the tax. The tax does not include pensions, unemployment, interest, dividends, capital gains, rental income, lottery winnings or income tax earned by estates, she said.
The last time voters approved a levy for the school district was in 1992, and it expired in 2004, she said. The school board attempted to pass a levy since then and voters did not approve it, leading to several staffing cuts in past years.
Savings from those cuts contributed to a $6 million cash surplus for the district, Board President Steve Setty said Monday. The school board decided it needed to start adding back some programs and staff that were cut.
Since the board began adding more staff, board members knew they might need to add income through a levy, Setty said. State funding has remained flat or declined, and the latest state budget proposal looks as if it may reduce that funding to Graham by $500,000 annually. Current district funding forecast predictions put it at $6.2 million in the red by the 2020-21 school year without the levy, according to the district’s five-year financial forecast.
“Our district has continuously strived to offer the best education within the resources we had,” said board member Ryan Pine. “Previous administrations have done an excellent job providing quality education within those constraints and the decreasing funds from the state. I believe after a generation of operating in these constraints it is time to reject the status quo and provide the resources and programming to better prepare our students for tomorrow.”
Fellow board member Miranda Uhl agreed: “Education is valued in our home. It is worth the 1 percent (tax),” she said. “We see this as a very valuable cost to our home and our kids’ future.”
Community member Wayne Harris asked the board members if they would all be paying the tax if approved. Setty said all of the board members live in the district, so they would all be subject to the tax.
Setty said the board set up priorities for the future of the district with community involvement. That created the Graham 2020 strategic plan, which outlines a variety of goals. The staff being added are in line with those goals, but the funding must be increased to maintain the changes already put in place.
Setty added an income tax is common to neighboring districts, and 1 percent is about in line with other districts in the area.
Graham Superintendent Kirk Koennecke said the district will still be one of the lowest in the state in terms of taxing its residents, and even if the levy passes, the district will continue to maintain a slim budget.
“It’s tough. We understand. But when we ask anybody for funds, they expect us to be good stewards of those funds. This budget will continue to be the most lean in the seven-county area, even with additional operating funds,” he said.
The board must approve a second resolution before it will appear on the ballot.
St. Paris Library levy
St. Paris Public Library’s 0.5-mill, five-year levy will be on the November ballot. The school board approved the second resolution to place it on the ballot Monday.
Both Graham Local Schools and the library board must approve the resolutions to put the levy on the ballot, since the library is a school district library. The library board approved both resolutions.
The levy would be a replacement levy, meaning it would update the property tax rolls. It is estimated to generate $105,000 annually.
Library Director Nicole Rush said the library needed a replacement instead of a renewal due to a 2013 change in state law. That change involved “double taxation.” If a resident is located in the territory of two different libraries, they should not be required to pay for both libraries. There were several townships that had overlapped districts between St. Paris Library and the Champaign County Public Library, so they evenly split up the townships. But the changed tax base also meant the library would lose some of its funding, so they sought replacement instead of renewal to keep the amount generated the same, she said.
The levy is the only one for the St. Paris Library.
“It is critical for us to maintain our programming,” Rush said.
The 0.5-mill levy was first put on as a result of budget cuts at the state level following the Great Recession. At the time, the state cut library budgets by 30 percent, Rush said. The latest state budget proposal suggests another library funding cut.
The election will be Nov. 7.
Casey S. Elliott may be reached at 937-652-1331 ext. 1772 or on Twitter @UDCElliott.