Business Leaders Back School Tax Hike
By Raviya H. Ismail, The Lexington Herald-Leader, Ky.
Aug. 29–Lexington business leaders have been quietly backing a school tax increase for the past three years, but vocalized their support yesterday, a day after the new rate was unanimously approved by school board members.
The five-member board on Monday approved an increase in the school portion of property taxes by more than 5 cents per $100 of assessed valuation. The extra money — the overall increase from 54.1 cents to 59.4 cents per $100 will generate $12.9 million next year — will allow the district to borrow the estimated $290 million it needs for school construction and renovation projects.
“There’s a direct correlation between the quality of school facilities and the quality of education,” said Guy Huguelet, chairman of Commerce Lexington, during a press conference at the district’s central office. “In order to build an advanced economy that we need to keep up with the global trends today, we must build world-class learning power.”
Several other groups, including the Home Builders Association of Lexington, also are in support of the tax increase.
“Of course it’s going to affect property tax values, as it is a property tax increase,” said Todd Johnson, executive vice president of the association. “But the reason we support it is because … it’s the right thing for our community. Good schools help everyone, whether you have children in school or not.”
Of the 59.4 cents the district would collect, 53.9 cents would cover regular operating costs. The other 5.5 cents would be used for renovations and construction at up to 25 schools.
Without a rate increase, the district would have the money for renovation and construction of only three schools. During the public comment portion of the Monday’s meeting, more than two dozen people spoke in support of the rate increase. Some members of the Commerce Lexington board of directors spoke at the hearing, including the Rev. C.B. Akins and Bill Lear of the Stoll Keenon Ogden law firm. Superintendent Stu Silberman also is on Commerce Lexington’s board of directors.
Former school board member Steve Hyndman was one of four people questioning the tax increase. By law, the public has 44 days to file a petition with about 12,700 signatures to get the issue voted on through referendum. School leaders hope the public will not pursue a referendum.
“Any school district needs good schools if they want to be a world-class district,” said Hyndman. “That’s not the point in Fayette County. The point in Fayette County is that the superintendent and the school board are not looking at any options other than a tax increase.”
Hyndman said that, other than a 3-minute presentation about the increase, the public was not made aware of the tax increase.
“There has been absolutely no discussion, no involvement with the community, about ways we could address these facilities’ needs,” he said. “The school board took money out of our pocket but didn’t give the public an opportunity to question them and give input. … If the taxpayers are willing to sit back and allow this, we’ll just pay the taxes. Somebody’s got to step up and hold the board accountable.”
School leaders say they have appealed to legislators for extra money and have cut central office personnel by 68 positions, saving $4 million a year. But that still has not generated the money needed to address facilities’ needs.
“We would not be asking you to do this … if there were any other options available to us,” said Silberman.
The district will use the money to immediately address renovations at Cassidy and Arlington elementary schools and will build two new elementary schools in the Clays Mill and Hamburg areas.
P.G. Peeples, CEO of the Urban League and a member of the Fayette Equity Council, said the new tax rate is the first step in getting the district to “world-class” status.
“We need to make sure our children’s ability to learn is not hampered by our (inability) to provide them with a proper and comfortable learning environment,” Peeples said at yesterday’s press conference. “This tax is going to cost me a little bit of money that I will gladly pay. … But the cost of not doing it is the question.”
About half the 54 schools in the district need immediate construction or renovations. With existing funding, it could take well past 2025 before the work would be completed.
Under the new rate, the owner of a $100,000 home will pay $594 a year in property taxes for schools. Of that amount, $55 will go strictly for building and facility improvement in the school district. The median home value in Fayette County is $181,000. That school tax bill will rise by $95.93 up to $1,075.14.
Without the increased tax rate, the district would be able to borrow only $27.6 million toward projects, compared with the $290 million bonding capacity it will have with the new rate, which will appear on tax bills this fall.
The most recent school tax rate increase was in 2003, with the approval of a half-cent higher tax rate to cover regular operating expenses. In the past 10 years, the highest rate has been 54.7 cents per $100 of assessed property in the 1998-99 school year.
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