Budget blessing

State aid more than budgeted; BASD taxes may fall

By Jennifer Eisenbart

Staff writer

Budget battle-weary Burlington Area School District taxpayers got some welcome news from the state late last week.

After budgeting for a huge drop in state aid, the district learned that the actual cut would be far less than it had anticipated. As a result, district officials are now saying there will be no tax levy increase and potentially no use of the district fund balance.

The bottom line, according to officials, is tax bills for the school district may actually decline.

Superintendent Peter Smet confirmed the information Tuesday afternoon. The district will receive approximately $14.4 million in state aid for the 2012-13 school year.

The district budgeted for $13.7 million, which is $706,412 less than it will receive.

Smet said Tuesday the result will be lowering the tax levy increase to zero percent, which when added with the TIF districts closing in the city – and creating a bigger tax base – will likely result in people seeing a drop in their school tax bill.

“I would think that most taxpayers would be very happy with a zero percent levy increase, not having to utilize the fund balance resources and with that zero levy increase, remember we are getting the TIF coming offline,” Smet said. “Most people should see a school tax decrease.”

Smet said the district budgeted very conservatively when it came to estimates of state aid.

“We just couldn’t calculate any more accurately,” he said. “We used the worst-case scenario.

“I was anticipating a couple hundred thousand, not seven hundred thousand,” Smet said of the state aid coming back in the district’s favor.

The school budget has been under fire for the last several months, mainly because it included about a 2 percent wage increase for teachers and a change in health insurance that cut costs and also meant the district did not need to ask for employee premium payments.

The health insurance package comes with two options – either a high deductible plan where employees will be required to pay up to $1,000 (single) or $3,000 (family) out of pocket, or using the current coverage and contribute approximately 12 percent toward the premium cost.

The fact that the budget did not call for that contribution automatically and allowed for a cost of living increase in pay led to new School Board members Roger Koldeway and Philip Ketterhagen voting against the budget when the rest of the board approved it.

Koldeway said in an email Tuesday evening that the state aid increase was good news, but thought the whole issue could have been resolved before this.

“If the School Board had required the staff to pay 12.8 percent of their insurance premiums, as other districts in the area have, much of the unnecessary levy increase from last year could have been returned to the taxpayers with a levy reduction,” Koldeway said.

Ketterhagen did not immediately return a call seeking comment.

Smet said the next step for the budget would be to set a Finance Committee meeting to discuss not only this change, but a proposed change for cash in lieu of health insurance – which will go in front of the committee to consider a cap of $3,864.

Smet said, at this point, decreasing that benefit likely will not cost the district money, because the number should still encourage people to take health insurance elsewhere.

“It’s still to people’s advantage,” he said.

An action meeting to approve the changes would follow the Finance Committee meeting, but neither meeting had been set before the holiday.