Published Wednesday, June 19, 2002
set for tonight
By Erin Remai
Herald Staff Writer
Sharpsville school board members continued to debate whether to raise taxes 3 mills to provide the school district extra financial security for the future, or to spend down the fund balance and give taxpayers a break.
The board is expected to approve a final $10.9 million budget and set property tax millage at a meeting at 7 tonight.
Although the tentative budget carries a 3-mill tax hike -- 9 mills under the old county assessment ratio or about a 5.6 percent increase -- some board members want to look into alternatives to raising taxes.
Last year, county commissioners changed the ratio from one-third of a property's market value to 100 percent. Sharpsville's millage is currently set at 53 mills -- 159 mills under the old ratio.
Finance committee Chairman Robert Timmerman raised the idea of using the fund balance rather than tax money to balance the budget at the May school board meeting.
At last week's work session, board Vice President DavidDeForest said the budget would require at least a 1.5 mill increase to balance. With no tax increase at all, the board would have to cut about $90,000 out of the budget or pledge $90,000 of the fund balance.
The projected fund balance for the 2002-03 school year is $769,905. If directors forego a tax increase and spend that money, there would be $474,000 left at the end of the year, according to district projections.
Some board members questioned whether that would be enough. Business Manager Jaime Roberts said the fund balance would drop to less than a month's payroll, which is $530,000.
"You could run this down to zero if you want, but you're going to get caught," said board Vice President David DeForest
Director Donna Murray, who is against the tax increase, asked what the worst case scenario would be if the board had to use the fund balance to cover expenses. Solicitor John Reed said the board could apply for a tax anticipation loan, which borrows money against projected tax revenue. The board has never qualified or applied for a tax anticipation note in the past.
Mrs. Murray said taxpayers deserve a break. During the past three years, taxes have increased 6.25 mills -- 19 mills under the old assessment ratio -- to pay for the elementary school building project.
Director Charles "Chaz" Rice agreed with Mrs. Murray, saying the board should use money it already has.
"At the end of the day, we've always had money to carry over to the next year," Rice said. "I believe this budget can be balanced without raising any millage."
Board President Terry Karsonovich said he didn't know if the district needed 3 mills, but that it needed some kind of increase for security.
"We're talking about next year. Costs always go up ... We're building a cushion by taking some kind of millage increase this year ... I'm not necessarily sold on three, but we need something in here."
"However you do this budget, don't just look at it from a personal standpoint, but for the good of the district, and not just for this year, but for future years," Karsonovich said.
You can e-mail Herald Staff Writer Erin Remai at eremai@sharon-herald.com