Friday, August 29, 2014

Board of education battles "chronic funding problem"

The Fort Thomas Board of Ed. and Superintendent Gene Kirchner met Thursday to discuss a 4% increase in tax revenue/Pat LaFleur

It was not a simple "yea or nay" affair at Thursday night's public hearing, held by the Fort Thomas Board of Education (BoE), to gather public input before voting (unanimously) to approve a 4% increase in total tax revenue for Fort Thomas Independent Schools (FTIS) for the 2014-15 school year.

The board, along with FTIS Superintendent Gene Kirchner, spent approximately sixty minutes laying out the realities of what board member Scott Johnson referred to as the district's "chronic funding problem."

The only catch to the board's hour-long discussion: just three community members showed up.

Why 4%?

Like any issue involving tax rates -- especially those that benefit "special tax districts," like for example school districts or public libraries, which can levy taxes from local residents with less oversight than other, larger taxing entities -- the 4% increase is complex and can be misleading.

According to KRS 160.470, or as it's colloquially known, "House Bill 44," special tax districts are allowed, by law, to increase local tax rates each year so as to yield an increase in total tax revenue of no more than 4%. When this statute was passed in the late 1970's, this was originally intended to account for inflation.

In terms of real dollars and cents levied from Fort Thomas residents, Kirchner explained, a 4% bump in total revenue means an increase in real property tax rates of 1.9 cents per $100 of assessed property value.

This is the rate increase Kirchner recommended to the Board Thursday night, which was then approved unanimously. With the Board's approval, the real property tax rate in Fort Thomas increased from 98.6 cents to 100.5 cents per $100 assessed property value, or roughly a $38 increase for a $100,000 home.

Why is an increase in funding necessary?

One of the residents in attendance kicked off the hearing with what is probably the most popular question: why does FTIS continue to need more money each year?

Kirchner laid it plain, saying, "The combination of our continued effort to improve school facilities, the growth in student enrollment, and state mandated pay raises (for school employees) make additional revenue a necessity."

Current enrollment in the FTIS district is nearing 3,000 students, Kirchner reported, an increase member Johnson measured at 24% since joining the board eight years ago.

Additionally, the General Assembly has also passed a mandatory pay raise for school employees of 1% in the current year and 2% next year. This is in addition to the annual stair-step pay-raise scale for teachers already mandated by state law.

None of this accounts for the estimated $35-40 million worth of "unmet need" still pervading the district, Kirchner also explained. Moyer and Johnson Elementary are both in need of major renovations, Kirchner said, as well as continued work at the high school.

"You can go see the Johnson Elementary I attended I don't want to say how many years ago," said board member Karen Allen, "It's still there... exactly the same as when I went."

But why a local increase?

The state calculates the amount of funding allocated to each school district based primarily on assessed property value and tax revenue collected on those properties.

"Districts like ours are at an inherent disadvantage in this system," Kirchner said, because while commercial and residential properties -- that is, almost the entirety of property in the region, and especially in a district like Fort Thomas -- are taxable in the state of Kentucky, farming property -- the geographical majority of property state-wide -- is not.

This creates, Kirchner continued, a perceived wealth-based advantage (more revenue in property taxes) for non-rural local districts, like Fort Thomas, and a diminished perceived need for state funding. As a result, FTIS currently ranks 168th out of 174 districts state-wide in terms of state funding, and 173rd out of 174 in terms of federal funding, Kirchner reported.

Kirchner also addressed concerns over the district's opt-out of the federal lunch program, announced earlier this year. "The lunch program operates in a silo. By taking local control, we are actually offering students more options for less money, and no general fund money is used for the lunch program."

"The General Assembly has outsourced public education to local communities like ours," Kirchner concluded, "And until the formula changes, communities like ours will be in this predicament."

The board has in the past considered taking legal action against the state, according to Johnson, but backed off so as not to place an even higher burden on tax payers in litigation costs.

Look to the results

For Kirchner and the Board, who have approved a similar tax increase each year for roughly the past decade, the reason to approve the increase should be clear, even for all those in the community who did not attend Thursday night's hearing: the performance and continued success of Fort Thomas students.

"The tax is high, but we take it very seriously, and the results are all around you," Kirchner said to the community members present. FTIS consistently sits at the top of performance rankings, state- and nationwide. "There are 174 school districts in the state of Kentucky," Kirchner said to one concerned resident, "and you're sitting in the best one."

For board member Brad Fennell, who also works in real estate, the tax increase is not just an investment in the schools, but the community as a whole, saying, "I've seen a direct correlation between the success of these schools and the value of my properties."

To boot, the district has been achieving higher results than ever even while "running this district much more fiscally tight than eight years ago," Johnson, who sits on the district's budget committee and fundraising task force, said.

The board also outlined other initiatives currently in place, including a massive, three to five year plan toward a (nearly) paper-free district, along with a number of public/private partnerships, to accommodate for the relative absence of state funding.

3 comments:

  1. I would have attended the meeting, but I didn't find out about it until Friday morning, when your article appeared in my feed. Where did they advertise this meeting?

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  2. 1.9 cents per $100 is $19 for $100,000 home. Not $38

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  3. "a $38 increase for a $100,000 home."

    This needs a correction.

    It is only $19 on $100,000. Or $38 on $200,000.

    ReplyDelete