Despite flat budget, Woodford school could still see tax penalties
WOODFORD >> Woodford School Board members finds themselves stuck between a rock and a hard place this budget season, despite keeping their spending under control.
According to Southwest Vermont Supervisory Union Chief Financial Officer Rick Pembroke's draft budget proposal, the small school's spending is only projected to increase $240 over last year. However, due to a decrease in revenues, a decrease in the town's common level of appraisal, and spending growth caps enacted as part of last year's Act 46, Woodford's residents could see a tax hike this year, although a mild increase compared to those being seen in neighboring towns.
Woodford is also in a unique situation, said Pembroke, that may have been unanticipated by lawmakers when they signed Act 46 into law last spring. Woodford's education spending per equalized pupil is increasing from $9,074.33 in FY16 to a projected $9,878 in FY17, more than the $561.78 that the school is allowed to increase under Act 46 without incurring penalties. The penalty comes in the form of double taxation of any amount over the growth limit, in this case about $6,090. Cutting that amount from the budget would be simple, except that the state also has a base spending rate, which was raised this year to $9,870 per equalized pupil. According to documents on the Agency of Education's website, "Homestead property tax rates cannot be lower than the base rate, even if the district spends less than the base amount." So, if Woodford cuts its spending per equalized pupil more than $8, much less than the approximately $242 cut needed to get under the spending limits, the town will still be taxed at the higher rate.
"It will probably be less expensive to pay the double tax than to drop below the $9,870," said Pembroke, who said that he still needs to do more research to see if Woodford can find a way out of the situation.
As of right now, Woodford's tax rate projects to increase by 5.47 cents per $100 in property value, but Pembroke said that number could be completely meaningless, and that the situation could change drastically based on the next few weeks, and if the legal clarifications he's seeking work out in Woodford's favor.
While the district's spending is relatively level, Woodford, like other schools across the state, is seeing an increase in projected early childhood education costs, due to the new mandate that schools provide education, either directly or through certified providers, to three-year-olds. Woodford Elementary Principal Sandy Foster expressed frustration that the state was mandating new expenses, $27,000 in Woodford's case, while also double-taxing the school district for spending too much.
"I have a hard time understanding the state's intent, at a time when they are asking schools to tighten their purse-strings," she said.
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