School Funding Basics: General Overview and Ways to Accomplish Site Improvements
Explore the fundamentals of school funding including the General Fund and various methods for achieving site improvements without borrowing. Learn about the Sinking Fund, Bond Issuance, and the role of the General Fund in supporting essential school resources. Dive into the details of how funds are allocated for teaching supplies, utilities, fuel, and staff salaries. Gain insights into managing financial resources for school development and maintenance.
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Presentation Transcript
School Funding Basics General Fund
School Funding Basics Food Service Fund General Fund
School Funding Basics Food Service Fund General Fund Agency (Student Activities) Fund
School Funding Basics Debt Service/ Capital Projects Fund Food Service Fund General Fund Agency (Student Activities) Fund
School Funding Basics Debt Service/ Capital Projects Fund Food Service Fund General Fund Agency (Student Activities) Fund Sinking Fund
Three Main Ways to Accomplish Site Improvements Sinking Fund Collection of funds without borrowing for a specified period of time Bond Issue An authorization to borrow money up front in order to pay it back (with interest) over long periods of time General Fund also pays for teaching supplies, utilities, fuel, salaries, etc.
Three Main Ways to Accomplish Site Improvements Bond Issue General Fund Sinking Fund
Three Main Ways to Accomplish Site Improvements Bond Issue General Fund Sinking Fund
Three Main Ways to Accomplish Site Improvements Bond Issue General Fund Sinking Fund
Three Main Ways to Accomplish Site Improvements Bond Issue General Fund Sinking Fund
Sinking Fund Proposal Proposal asks for a 10-year sinking fund at mill per year Will generate about $170,000 annually for projects and maintenance in the district Is done on a pay-as-you-go basis no borrowing and no interest payments May not be used for supplies, salaries, or equipment Will not be used for land or property purchase
Why Now? Several projects need immediate attention Building security Safety improvements Lower level parking lot at the elementary Site lighting at the high school High school carpeting, lighting, lockers, and mechanicals Auditorium lighting, sound, and control panels Preparation for future needs Ongoing maintenance costs as buildings age
Why Not the General Fund? Limited availability of funds each year Basic maintenance must come first, and that is even difficult to do financially Major projects are not able to be funded without taking money away from the educational program
Why Not Another Bond Issue? Necessitates selling of bonds, with related interest costs Because funds must be expended within five years, would necessitate a higher tax rate Cannot be used for items not specifically included in the bond request, and therefore cannot be used for unforeseen needs
An Example High School Roof Replacement Cost of $597,000 Failure of roof occurred right after bond issue Forced to borrow and pay back from General Fund (still paying!) Interest cost (even after refinancing) of $109,000
What Will It Cost? 1 mill = 1/1000 (or 0.001) mill = 0.0005 mill x Taxable Value = Amount of Tax Taxable Value is typically of the property s value Therefore, a $100,000 home (taxable value of $50,000) would be taxed $25 per year 0.0005 x $50,000 = $25
The Ballot Language Shall the limitation on the amount of taxes which may be assessed against all property in Fennville Public Schools, Allegan County, Michigan, be increased by and the board of education be authorized to levy not to exceed .5 mill ($0.50 on each $1,000 of taxable valuation) for a period of 10 years, 2013 to 2022, inclusive, to create a sinking fund for the construction or repair of school buildings; the estimate of the revenue the school district will collect if the millage is approved and levied in 2013 is approximately $170,000?
Also on the Ballot The annual authorization to levy 18 mills on non- homestead (vacation and business) property
