2.2 $12,000,000 TAX HIKE
An additional question facing our community:
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What happens when 18 percent of school district revenue is cut off?
- Will the burden of replacing the lost revenue be shifted to residential and commercial property taxpayers?
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Will the school reduce its expenditure level an equivalent amount?
Before addressing that question and the board’s response, here is some background. In fiscal year 2005 (2004-2005 school year) Sycamore received approximately $12 million, or over 18% of its funding from the Tangible Personal Property Tax (TPPT). It is a property tax on business machinery, equipment and inventory. The TPP tax was eliminated in 2004, because it was a roadblock to income growth and job creation in Ohio. Since then the school has been receiving a full reimbursement of those TPPT funds from the state. Beginning in FY011, the state will start the phase out of these reimbursements. The reimbursement will end in the FY2018 resulting in a loss of annual revenue totaling $12 million.
Sycamore’s Five Year Forecast Assumptions dated October, 2005 included the following message. By implementing this change in the tax structure and providing reimbursement of funds lost for a period of time, the state has given school districts time to make adjustments to their expenditure patterns to prepare for this long-term loss of finds.
Board response: Our capped budget approach has been discussed in many of our Board Meetings held in public. As much as we would like, we have no control over Ohio State Legislators who have eliminated (phased out from 2011 – 2018 the Tangible Personal Property Tax for all school districts). Thus, our forecast reflects this phase out and is incorporated in our planned revenue base. We think our capped budget and under-spends for the past several years has cushioned this impact as best we can for property owners including residents and businesses.
BEWARE! The “capped budget” approach has failed to reduce the exorbitant spending level and failed to make the district efficient enough to spare the taxpayers a $12 million tax hike. It seems that our board of education’s intent is to pass on the $12 million loss revenue to residential and commercial property owners. Enough is Enough!