Holley will slash school taxes
Residents will get an $800,000 tax cut
HOLLEY – The Board of Education will cut school taxes by 10.6 percent or $800,000, according to a $25 million budget that was approved during tonight’s board meeting.
The tax cut would reduce residents tax rate from $25.11 to a projected $22.44 per $1,000 of assessed property. The 2014-15 budget goes before voters on May 20.
“We’re giving some money back,” said Brenda Swanger, the BOE president.
The district is responding to a state comptroller’s audit in February. The report said Holley’s cash reserves were too big. (Click here to see the report.)
In addition to cutting taxes, Holley is paying down $975,000 in debt. That will reduce Holley’s debt and interest payments in the immediate future.
Holley may also pay for new school buses from the surplus rather than borrowing money, said Kathy Saville, the district’s business administrator. The Board of Education also voted tonight to create a $2.5 million capital reserve fund. Some of the surplus could be moved into that account near the end of this school year.
Holley is raising its budget from $22,976,429 to $25,070,000 with the accelerated debt payments causing most of that spending increase. The BOE also plans to add four instructional staff to help bolster students’ academic performance, Swanger said.
The statutory limit for surplus funds is 4 percent of the ensuing year’s budget or about $1 million for Holley, according to the comptroller. The district was over the surplus fund threshold by more than $7 million or 35 percent, according to the comptroller’s report.
Holley is working to reduce the surplus to about 6 to 7 percent of the budget. Saville doesn’t want to go all the way down to 4 percent or $1 million.
“One million dollars doesn’t even get you through one payroll,” Saville said.
Holley collected $7,541,779 in taxes in the 2013-14 budget. The tax levy will drop to $6,741,780 as part of the proposed budget.