As Big Tax Increase Looms, state legislators say school board should provide tax relief, substantially lower levy rate

When property tax bills are mailed in mid February, prepare for some possible shock. It’s one of those good news/bad news stories. Bad news: your taxes will likely see a big hike. Good News: school districts will get a lot more funding, and the big increase might only last one year.

In late June the state legislature passed a bill (EHB 2242) to meet the state’s constitutional obligation to fully fund basic education and alleviate school districts’ reliance on local levies – something that has also created inequity between local districts over the years.

So the good news is school districts, including Snoqualmie Valley, will be getting A LOT more state funding starting in the 2018-19 school year. By 2019 the state estimates SVSD will get $20 million in new state funding – $2 million more than the $18 million it currently collects in local levy dollars.

Bad news: the state education levy rate is increasing in 2018 so the state can start collecting that new school funding it needs to distribute. In 2018 that levy rate was set to decrease to $1.88/1000 of assessed property value. Instead the education levy rate will now increase by .82 to $2.70/1000.

Good news: so as not to not overly burden taxpayers, the legislation also capped the rate districts could levy locally at $1.50/1000 or $2500/student, which ever is less. [SVSD will be subject to the $1.50 cap.] Bad news: that cap doesn’t start until 2019.

In a nutshell: In 2018 Snoqualmie Valley taxpayers will see a .82 state levy increase and SVSD will still collect its high local levy valued around $2.25/1000. But in 2019 the district is required to lower its levy rate to $1.50/1000 or below.

All three 5th District State representatives – Rep. Graves (R), Senator Mullet (D) and Rep. Rodne (R) – say the new legislation should allow SVSD to substantially lower its local levy rate in 2019 – even well below the $1.50 rate cap, providing tax relief for constituents, lessening the reliance on local levies, and collecting millions more in funding.

SVSD Levy Rate 

If SVSD decides to max out the local levy rate at $1.50, it’s estimated that would bring in about $12 million annually. Combined with the new estimated $20 million in state funding ($2 million above the current local levy collected), the district could see $14 million in additional school funding compared to today.

With the new education funding bill, SVSD stands to be one of the luckier districts. Because SVSD currently has a high local levy rate, it is in a position to cut that rate, possibly providing some tax relief, and still collect more funding. Other larger districts with much lower local levy rates will likely see a permanent tax increase along with the increased funding.

State Law Makers Weigh In, Call on Districts to Cut LevyRates

According to Washington State 5th District Senator Mark Mullet, this legislation has put SVSD is a good position. Mullet has been urging the SVSD school board to cut its current $2.25 local levy rate in half. He says the district has an opportunity to give taxpayers – who were recently hit with a large increase with the passage of a $244 million school bond – a modest break.

Mullet called it a win-win for the district, saying SVSD can cut its local levy in half to $1.13/1000, offering modest tax relief while still increasing funding.

Representative Graves called the legislation a ‘home run’ for the Snoqualmie Valley. He said the millions more in state funding for SVSD is the reason he voted for the legislation and like Senator Mullet, hopes the district will substantially lower its local levy rate.

District Working to Decide Future Levy Rate

As the district prepares to run a 4-year school levy on the  February 13th ballot, it is grappling with the amount to request of voters, due mostly to the unanswered questions it says the new funding model has created.

EHB 2442 altered how the state will pay teachers, switching to an average pay system that includes caps on tenured teachers and higher pay for starting teachers. Places where the cost of living is higher (like the Snoqualmie Valley) will also get an increase in funding. STEM and foreign language teachers can also be paid higher.

Districts worry there will be requirements as to where they can spend that new state funding, and that local levy dollars might be needed to fill those gaps and hire more teachers than the state will fund.

There’s also been some worry that it’s just too good to be true – and will the state come through on that estimated $20 million in new funding.

Washington State 5th District Representative Jay Rodne said the funding is solid and agreed with Mullet that if districts can reduce taxes for residents while still collecting more money, the current tax rate should be reduced below the new $1.50/1000 cap.

Rep. Graves agreed the new funding is coming, saying it is in the state budget and appropriated. Mullet echoed the solidity of the funding, adding that during previous legislative sessions, when the state also approved more education funding, that money was delivered to local districts as promised.

SVSD Levy Planning Continues

The district is expected to continue the levy rate discussion in upcoming school board meetings. The next meeting is scheduled for Tuesday, October 10th at 6:30PM at Snoqualmie City Hall.

To date, the dollar amount of new state funding has not been discussed with the board. That discussion component is expected at a future meeting. At the September 28th meeting, Board Member Simpson asked for the dollar amount so the board could have clear picture on what local levy might be needed.

Simpson commented, “Before we presume we need to levy locally we need to assess the increased state funding and whether we need additional funds from our taxpayers locally to run our schools. To simply jump to the presumption we need to levy before having this discussion doesn’t make sense. I also want to determine if we can roll back our last year of the old levy to prevent a tax increase in 2018.“

In order to place a levy measure on the February ballot, the school board will need to approve a resolution with the levy rate [most likely] within the next month.

What are other districts doing?

So far it appears other districts are also struggling with where to set local levy rates. Issaquah has yet to announce the amount of its February levy. The Lake Washington School District Levy and Bond Planning Committee recently recommended setting their new rate at $1.03/1000, down from $1.26/1000 in 2014. [The most LWSD could levy was $1.29/1000 due to the $2500 per student cap.]

If you’d like to weigh in on the levy rate discussion, you can write school board members or attend upcoming meetings.

Snoqualmie Valley School Board Members

 

Snoqualmie Valley School Board, Superintendent Joel Aune and student board reps.

Comments

  1. This new state funding leaves several very critical questions that the current school board needs to address. If I had the privilege of serving on the SVSD school board, I would focus on two major decisions.
    1) Given the fact that our district will be receiving this additional funding, should we roll back all, or a portion, of the current levy? In making this decision, we need to assess whether or not the school district still needs the funds that will be coming in from the expiring levy, and to what extent. For example, it may be determined that only a portion of the levy funds are needed, which could result in some tax relief.

    2) Does the school district need to run a local levy next year? If so, at what dollar value? As stated in the article, the $20M in funding coming to SVSD is $2million more than what the district receives currently from our local levies. Due to restrictions on how state funds are used, a local levy may be required. However, due to the significant tax increase that the community will see, the district has a responsibility to tax payers to share exactly how the levy rate was determined and what the district will use the levy dollars for. Our lawmakers are suggesting cutting our current local levy in half, which will provide tax relief while our schools still receive additional funding. Once again, the question needs to be, “what do we need the additional local levy money for, and how much do we need?”

    These decisions will financially impact everyone living in the Snoqualmie valley school district. This information and these decision-making policies have historically not been shared by the school board with the public. I believe this information should be public record and these decisions should be made with total transparency.

    Given the changes in how our schools will be funded going forward, it is even more important that the district establishes a new “citizen’s accountability report” informing the community how tax dollars are being spent, and how decisions regarding our school’s funding are being made.

    • Andrea Stiles says:

      All successfully-run organizations have a fiscal planning and budgeting process that includes market research and comprehensive analysis. The outcome of these actions yields data that is utilized to make decisions about funding and spending for the future. Melissa Johnson’s points here are not only valid, they are crucial. As a school board and administrative group, not utilizing all available data in order to form fiscal decisions that affect all Valley taxpayers is irresponsible, at best. Our school district administration needs to start running like a successful organization. As taxpayers and voters, we have the ability with next months’ election to get the right people on the school board who will work to be sure this happens.

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