Mythbusters: School Tax Edition

Got this comment on CSDWeAllWin’s Facebook page today.

Today I had a friend say all the programs and cuts Christina school district was making is nuts. All because people wont sign a referendum. My answer was Christina School district asked for almost 100% raise in funding on their first attempt. This was highway robbery. They then asked for I believe a 15% increase and it was shot down… You know why??? Everyone I talked to who googled the referendum, saw the previous request. They thought their taxes were doubling. The district did this to its self… So lets do a little math and see if the money is spent correctly. 2014 budget 228 million dollars. 16255 students. That is $14,026.45 / student. I googled the “average private school tuition 19711″… the answer was $11970.00. If it can be funded privately for 2000 less per student and provide a better education… Something isn’t adding up. We cant continue to throw money at a mismanaged program. I really don’t want to hear go to a budget meeting. I want to hear my math is either incorrect or why we should pay $2000.00 more per student for your education. What is better? I’m beginning to think the whole system should be private. Talk me off this ledge please.

So let’s go.  Sorry they don’t want to hear “go to a budget meeting”.  But GO TO A BUDGET MEETING!  Public school finances are too damn complex to talk about on Facebook and really get a solid handle on them.  But why not try again?

Their math isn’t wrong but it is the wrong kind of math. Districts do not determine per student funding by adding up the budget and dividing by the number of kids enrolled, although that seems like a much better way to do it than the way it’s done now.

Christina, and all districts in Delaware, have little control over how much money is spent on each student. Nearly all the formulas used to figure that out come directly from the State of Delaware. However much money the State determines each student “deserves” *in total*, Christina foots approximately 35% of it through property taxes.

In previous years, the District was responsible for <30% of the cost. Over the last 8 years the State has continued to chip away at the amount of money spent on education. This year is no different. The State raised the amount each student must get by 0.52% and at the same time said they wouldn’t be funding that increase, which means local money from each District has to cover that increase.

Christina School District per student general ed funding

This is the breakdown of our non-special services, regular education per student funding for 2015-16 school year. This is the amount of money, collected through our property taxes, that Christina School District spends per student. We, in this District, do not pay $14,000 per student. We pay an average of $3,913 per student in grades K-12. So what the hell is that $13,000 cost per student number you find on the District profile on Delaware Dept of Ed’s website? That’s an average of ALL sources of funding for our students, that’s all money that comes from the State + all money that comes from the District + all money that comes via the Federal gov’t that rolls up to an AVERAGE cost per student in our District.  It is NOT what we pay from property taxes per student.

You can pay $12,000 to send your child to a private school in Newark. But you, the parent, are paying that entire $12,000 for your child. Send your child to a public school, and you’re paying a fraction of what it costs to deliver an education to your child.

My property tax bill for schools last year (on my $189,000 townhome assessed at $50,000 ) was around $1,120. I have two children in the District. I paid $560 in taxes for each of their educations last year. If I had both of them in private school, my school tax would still have been $1,120. Plus $24,000 for private tuition. I don’t know about you, but I sure as hell can’t afford $25,120 a year for school right now.

The current total *school tax* rate is $2.09/$100 assessed value of property. Of that $2.09, $1.42 of it is the *Operating Tax* rate. The Operating Tax rate is what was up for referendum twice. (I won’t get into the New Castle County Tax Pool dipping into that $1.42, that’s another discussion).

The first increase that the BOARD wanted (not the District) was, I believe, $0.65 phased in over 3 years. OMG THAT’S 46% INCREASE IN TAX……RATE. Increase in your tax RATE. That does NOT = a 46% increase in your taxes paid. Why?

Let’s say that $0.65 was approved, and it all went into effect right away. The rate went from $2.09 to $2.74. The tax RATE is now $2.74/$100 of assessed value. For my house @ $50,000, my NEW school tax bill this year would be: $50,000/$100 = 500. 500 x $2.74 = $1,370

$1,370 is not double of $1,120. So what % increase is that in my ACTUAL taxes paid? $1,370-$1,120= $250 $250/$1,120 = 0.223 x 100 = 22.3% increase. Not even close to doubling.

Well we know the first time failed hard. So what if the second time passed? The DISTRICT asked for and the Board approved a $0.37 increase phased in over 3 years. Let’s take the same scenario. It passed, and all $0.37 went in right away. Our new tax RATE is $2.46/$100.

My new tax bill is: $50,000/$100 = 500. 500 x $2.46 = $1,230. Well how much did it go up this time?! $1,230-$1,120= $110. $110/$1,120 = 0.098 x 100 = 9.8% tax increase. Again, not even close to doubling.

Again, total budget/# students isn’t wrong math but it doesn’t do jack to help figure out how we spend money per-student and whether or not the money is being spent “correctly”.

I said before, during, and now after the referendum, I’m available to talk to anyone about this. I’ll answer any question you throw at me. If you don’t want to come to a budget meeting (although you should), I’ll come to you. Public school finances in this State are not easy to understand. It’s way too damn complex, but I’m willing to help anyone get a better understanding of it. Google won’t do anything for you. Talk to someone who actually knows something about how it works (or doesn’t work).

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Budget Season: Raise Taxes!, No! Cut Spending, No! Raise Taxes!

Those of you following along with the State’s budget woes understand what has to happen in order for the $80+ million gap to be closed.  Pretty much the same thing that Christina went through, either you raise revenue somehow or you obliterate your spending.  So we have lawmakers scrambling to find money without overtly saying they’re going to raise your taxes (like public school districts are forced to do every 3-5 years).

The latest maneuver is to adjust the realty transfer tax.   It’s currently 3% on all home sales in the State, split evenly between the State and the County or municipality the home is located in.  The new proposal is to make that 2% to the State, 1% to the county/municipality.  Kent and Sussex counties stand to lose the most from that deal as their smaller towns rely more heavily on the 1.5% the transfer tax affords them when a home is sold.  I get that the State needs to find money, but what puzzles me is a quote from State Senator Karen Peterson, D-Stanton.  She said

counties need to take more responsibility for reassessing their properties, claiming that some hadn’t done that for decades. “If they need a kick in the seat of the pants to get moving then let’s do this.

She’s right about the last time assessments were done.  New Castle County did it in 1983, Kent and Sussex in the 70s.  But if I follow correctly, she’s insinuating that counties should rely less on the State for their revenue (via taxes/fees like the transfer tax) and reassessing their properties would address that.

The State is $83 million short right now, presumably because they are not collecting enough taxes to meet their spending needs.  There would be open revolt if the State attempted to directly raise taxes (see Markell’s gas tax, or eliminating the Senior Property Tax Credit).  County reassessments would likely result in increased property taxes in all 3 counties.  Kent and Sussex residents would get hit HARD.  Think of all that new development happening down there.

And then Representative Melanie George Smith, D-Bear:

“We’ve assumed a lot of responsibilities back from the counties without charging them for it and so given that, this is the year we finally need to make those equal,”

Again, the State is $83 million short.  Rep. George Smith is echoing Sen. Peterson.  Both want to essentially pass the State’s budget shortfall onto the Counties which will, in turn, pass them on to their residents.  In theory, the Counties would rely less on State funds and the State would reclaim some of its expenses.  The State is positioning to indirectly raise taxes by having the Counties do the dirty work for them.  They’re afraid to say these words: “We need to raise taxes.” and even more afraid to say who they really need to raise taxes on.  Strike that, not everyone is afraid to say it.  Rep. John Kowalko said it.

Keep kicking that can, Delaware.

http://delawarepublic.org/post/state-lawmakers-grab-bigger-share-realty-transfer-tax

$6.3 Million Gone in a Flash

You know, I have been seeing more and more red light cameras being put up at intersections throughout New Castle County.  I wonder if the same arrangement is in place here: a private firm that owns the cameras gets a cut of each ticket when someone runs a red light.  I’m all for idiots who speed through red lights getting fined and/or pulled over to converse with a member of our law enforcement teams, but I’m not sure a private company should be profiting off of that.  Enforcement of law shouldn’t be about profit generation for private companies.  Just my $0.02.

Broward judges toss 24,000 red-light camera tickets totaling millions