Property tax levy decreases for third straight year

For the third year in a row, the property tax levy in District 196 will be less than the previous year.

At its Sept. 24 meeting, the School Board approved a proposed property tax levy for 2012 (payable 2013) that is 2.5 percent less than the current year. The proposed tax levy of $73.9 million is approximately $1.9 million less than the payable 2012 levy of $75.8 million. For payable 2011 taxes, the district levy was $78.4 million and for payable 2010 it was $79.4 million.

The Minnesota Department of Education calculates the maximum amount each school district may levy in several categories that support specific programs or expenditures. The proposed levy approved by the board represents the maximum amount allowed by the state. The final 2012 (payable 2013) property tax levy that the board will approve in December may be less than but not greater than the proposed levy.

Director of Finance and Operations Jeff Solomon attributes this year's tax levy decrease to three main factors. The largest of these is an $833,000 reduction in the debt service levy as a result of retiring debt and debt refinancing actions that were approved by the board the past two years. The alternative facilities levy, which provides funding for building maintenance projects, is $617,000 less due to effective management of previous projects that resulted in savings that can be used to fund projects this year, Solomon said.

The third factor, an increase of approximately $500,000 in state equalization aid, is the result of a fourth year of declining market values in the district. The decrease in referendum market value, from $13.7 billion to $13.3 billion, makes the district eligible to receive additional equalization aid from the state.

Property taxes represent approximately 22 percent of the total revenues District 196 will receive this year. State aids and credits account for 66 percent of revenues, 3 percent will come from federal aid and the remaining 9 percent from other sources such as grants and donations.

The proposed levy will now be submitted to Dakota County. In mid-November, the county will mail notices to property owners showing estimated taxes based on proposed levies approved by the school district, cities, the county and other taxing agencies.

The School Board will certify a final levy for school district taxes payable in 2013 at its Dec. 10 meeting. Residents will have opportunities to comment on the proposed final levy prior to the board's action at that meeting.