Willmar School District pushing drop in property tax levy
WILLMAR — Property taxes for the Willmar Public Schools are expected to be nearly 30 percent less in 2014, partly because the district is close to paying off the bonds for its 19-year-old high school.
The Willmar School Board adopted a $4.94 million preliminary 2014 tax levy Monday, a 27 percent decrease from the $6.77 million levy for this year. The board held a special meeting Monday before its regular workshop meeting. The preliminary levy was the only item on the agenda.
A final property tax levy is a combination of school, city or township, and county taxes. Preliminary tax statements will be mailed by counties in late November.
The final school levy will be adopted in December, after the Dec. 9 Truth in Taxation hearing.
The levy amount could change before final adoption, if changes are made by the state, said Business and Finance Director Pam Harrington.
“This is set by statute,” Harrington said, and local districts can only affect the amount of the levy through voter-approved referendums.
The levy has four parts: general levy, referendum, community education and debt service.
The largest decrease is coming because the district is nearly out of debt.
“This is the last levy to pay off the Senior High bonds,” Harrington said.
During the life of the bonds, state law has required the district to levy 105 percent of the annual payment, she said. That allows bond payments to be made regardless of possible tax delinquencies.
Over time, the fund develops a surplus, and that surplus will be used for the final payment. Because of the surplus, the $2.45 million levy for bond payments this year will be reduced to $893,000 next year.
The levy for the general fund will increase from $1.77 million to $2.5 million. The general fund levy makes up a small portion of the annual operating budget of the district, which is more than $40 million. Most of the funding comes from state aid.
The changes in the general fund levy are caused by numerous changes made by the 2013 Legislature. The district will receive more state aid in some areas, which will reduce its tax levy.
The levy has increased for integration/achievement revenue, for safe schools programs and for health and safety projects.
Changes in state formulas have also changed the amount of referendum levy taxpayers will pay. This year, the levy for voter-approved levies was $2.2 million. In the coming year, it will be $1.17 million, a reduction of 47 percent. With the new formula, the state is paying a larger portion of the referendum levy than before it did before.
The only part of the levy that is not seeing much change is the community education levy, which will increase 7 percent to $376,000.