Reduced funding from the state, increased utility costs and higher insurance rates are just some of the reasons that a 7-mill property tax hike may be in the future for Lakeview School District.

Directors on May 21 approved, 5 to 3, the proposed tax increase for the 2001-02 school year for an operating budget of $11,786,846. It is a $787,804 increase over last year’s budget.

The proposed 7-mill tax increase -- to 128 mills -- would bring in about $140,000 to the district. It would cost the average taxpayer about $74, according to board secretary Cheryl Carothers.

A mill is $1 for every $1,000 of assessed property value; assessments are one-third of a property’s 1970 market value.

Board Vice President Gary Shelhamer, Ruth Slater and Jane Clark voted against the spending plan. One board member, Elton Alexander, was absent. Board President Donald Barbour, Scott Rau, Sally McQuiston, William Evans and Jane Buckley voted for it.

According to Superintendent Dr Paulette Savolskis, the increase will cover the district’s rising operating costs.

"We have had things happen from the state level that have caused us to look at our budget costs," she said.

Some of the state funding the district will no longer receive includes $29,000 for instructional support -- which involves two employees who work with special needs students, families and their teachers -- and $60,000 for Link To Learn, which is applied to technology in the school district.

"We chose to continue instructional support because it has been so successful for our students, and we have technology in our school that has to be addressed and update," Dr. Savolskis said.

Other state funding the school no longer gets is a basic education subsidy for small school assistance.

Increased insurance costs for employees and retirees has also taken its toll on the district, she said.

"The state passed House Bill 26 which mandates that school retirees get an increase in the amount of insurance reimbursement, but that local school districts would have to pick up the tab," she said, adding that employee health care costs increased by 34 percent last year.

"Our heating costs also went up by 70 percent this past school year," Dr. Savolskis said.

But a dissenting school board director is worried that the school system may be overly cautious. "I don’t feel they need a 7-mill increase at this time. There is a lot happening with the budget; some funding increases and decreases," Shelhamer said. "Sometimes it’s better to let some of these things be."

Property taxes in the district have increased by 12 mills in the last seven years, including 8 mills in the past two years for the middle/high school renovation project.

The renovations will begin this summer with asbestos removal; construction is set to begin in March.

A work session will be held on June 21, and the budget will be voted on at the regular meeting on June 25.