Part of the problem is that items impacting the tax cap amount for the coming year may force the Board Of Education to hope for that supermajority of votes. $1 million of debt service is falling off in 2016-17, which will reduce the district's property tax levy limit by about $400,000.
State building aid is also being reduced by about $650,000. The district has about $667,000 in capital reserves and unassigned funds that could be used to reduce the value of bonds that will pay for the $4 million septic replacement project. The board will have to decide whether or not to use some or all of that money or to bond for the full value of the septic project. School Business Administrator Mary June King and Superintendent Chris Pettograsso recommend the latter so that the $667,000 can be used for another capital project they hope to develop in the next year to help offset future revenue reductions.
Confused yet? There's more. Another complication will impact bus replacement next year. In the past the cost of busses was covered by replacing old debt that is paid off with a similar amount of debt for new busses. That meant no additional taxes, because the old debt is simply replaced with the new. But this year there is no paid off debt to replace.
King says busses are not lasting as long as they used to, perhaps because of changes to materials put on the roads to melt ice. The district has a regular bus replacement schedule, and this time it calls for replacing two full sized busses and a van.
"This year we do not have a related debt falling off," King said. "Typically I come to you and say there is no additional tax impact. We have $75,000 paid off and we're going to replace it with a $75,000 debt to replace the vehicles. Because there wasn't a purchase made five years ago we don't have any debt falling off."
If the money were to come from the general fund it would require a budget increase of between $25,000 and $30,000 per year. If the money comes from the debt service fund, it would have $0 tax impact, but would reduce dwindling resources. The debt service fund can only be used to help pay debt. If it is used for next year's bus purchase it's balance will be reduced from $409,972 to $271,032. King recommended using the debt service fund money, but board members have questions about whether that money should be used in other ways in the coming years. The School Board will have to decide which approach to take on march 24th.
School officials are projecting a $27,785,000 budget for 2014-15. Depending on how the Board Of Education chooses how much or how little to take from the appropriated fund balance and/or from taxpayers, the district may or may not be able to maintain its programs at the current level. So far district officials have been conservative about 'taking away programs from students' on the grounds that once they are gone it is very difficult and expensive to get them back.
King presented three scenarios, the most conservative of which would force the district to cut $300,000, probably in teachers and staff positions with the tax rate going up by 4.19%, raising taxes by an additional $174 for a $200,000 house. A second option takes more from the appropriated fund balance to make up for the cuts. That option would still raise the tax rate by 4.19% but it would not require cuts. A third option would be to take the smaller amount from the appropriated fund balace, but not cut spending. That would raise the tax rate by 5.89%, or an additional $244 for a $200,000 house.
All school districts are facing tough choices, but Lansing has particular challenges because of the reduction in the value of its biggest taxpayer, the Cayuga Power Plant coupled with the issue that the district's wealth rating entitles it to less state aid than most of the surrounding districts. That will mean tough choices for the School Board as they try to figure out how much more in taxes Lansing can bear before the district is forced to cut teaching and other positions. And tough choices for property taxpayers when they vote in May.