Seeking exceptions gives Highlands ‘options’ for budget, business manager says | TribLIVE.com
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Brian C. Rittmeyer

The Highlands School District is simply keeping its options open as it begins work on the 2019-20 spending plan, the district’s business manager told residents at a school board meeting Monday night.

Although the district intends to seek permission from the state to increase taxes by more than its limit without a voter referendum this year, that does not mean there will be a tax increase, business Manager Lori Byron said.

Formally, the district will apply to the state Department of Education for exceptions to a referendum based on special education and pension costs that, if granted, could allow it to increase property taxes by more than its 3.3 percent limit.

School districts can increase property taxes up to their individual limits without voter approval. Exceptions allow districts to exceed their limits without the otherwise required voter referendum.

“The act of applying for exceptions is just giving the district options if we need them,” Byron said, adding that it’s something many districts do.

Highlands’ $46 million preliminary budget “was developed with no tax increase in it,” she said.

As prepared, the district’s revenue is shown at $42.3 million. The $3.7 million difference is covered by the district’s reserves, which would be drawn down from $14.4 million to $10.7 million in total.

The school board approved the preliminary budget Monday. A proposed final budget will not be approved until May; the final budget will be approved in June.

Whether or not there is tax increase, and how much, is ultimately up to the school board.

Because the board did not declare by Jan. 31 that it would stay within its 3.3 percent limit, Highlands had to adopt a preliminary budget by Feb. 20, according to the state’s timeline for the 2019-20 budget process.

The deadline for school districts to seek approval from the education department for referendum exceptions is March 7. The department will rule on those requests by March 27.

If the department grants exceptions to Highlands, it would determine by how much the district could exceed its limit, Byron said.

Asked by a resident if they could expect a tax increase of at least 3.3 percent, Byron said that decision has not been made yet.

“There’s too many variables right now to make any kind of comment on what’s going to happen,” she said.

As district administrators work on the budget and gather information from department heads and building supervisors, the district will be using a “zero-based budget” approach this year, substitute Superintendent Monique Mawhinney said.

“It is something we’ve never done here at Highlands,” she said. “They start with nothing. They start at zero. They have to identify what is a need versus what is a want. It’s a huge change here.”

Byron said she will be making a budget presentation. It was not said when or where that will be.

The district is also preparing to publicize the names of delinquent taxpayers on its website. Byron previously said the district is owed more than $11 million in delinquent taxes.

Originally, the names of taxpayers on payment plans were going to be included. But after questioning by residents Monday, school board President Debbie Beale and Mawhinney said they will consider not including those names and instead providing a summary, without names, showing how much is owed and which taxpayers are making payments.

Mawhinney said doing that will take more time.

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