The Jackson R-2 School Board voted to keep the district’s property tax levy at $3.80 per $100 assessed valuation, choosing not raise the rate by 12 cents.
The district is expected to raise $25,637,141 through real estate and personal property tax for the 2022 tax year, an increase of $2,717,339 from last year.
The school district saw a large increase in new construction and personal property increases throughout the district, totaling $100,550,-848 compared to 2021’s $12,269,420. This year’s total included $39 million in new construction and an increase of $61 million in personal property.
Despite the increase in new revenue, the district was allowed to increase the tax rate by the state because its adjusted valuation calculation decreased.
“This year has been really tricky with calculations,” Assistant Superintendent Matt Lacy said. “The old adage would be that you lose $5,000 as soon as you drive a new car off the lot, and right now used car prices are skyrocketing. Because you have this weird fluctuation in used cars and property value, it has done some interesting things to the property tax rate calculations.”
The adjusted valuation compares this year’s assessed valuation of $674,661,611 minus the new construction and personal property, which equals $574,110,763, to last year’s assessed valuation.
“The problem is that when you look at last year’s valuation, which was $595,981,-050, you are actually down by $21,870,287,” Lacy said, adding that they were sure the calculations were correct. Several district officials ran the calculation and it was checked by the district’s financial advisor.
The district also checked with the county assessor’s office to make sure the new construction amount they used was correct. Lacy said staff in the assessors office told him other taxing entities in the county had called and were also experiencing atypical fluctuations this year.
“Because of this oddity where you’ve actually brought in more money but when you adjust your evaluation, you lose money – the state says you can recoup it by increasing the tax levy by 12 cents,” Lacy said to the school board.
If the district adjusted the tax levy to $3.9292 per $100 assessed valuation, the district would have raised an additional $871,497 in tax revenue.
Lacy said the district administrators recommended not raising the tax levy, which has been $3.80 for the past 16 years, because it may be difficult for the district to pass a future tax increase from voters, if needed, and the district would still see an increase of revenue this year.
“My whole philosophy is to be transparent in everything we do, Superintendent Scott Smith said. “If we need to raise our tax levy, then we should go to the voters to do that.”
Smith added that the choice to not increasing the tax rate this year locks in the $3.80 tax rate for next year, as well. “With this being an even-numbered year, this is the only year that we can actually bump our ceiling,” he said.
The board also voted to not add property tax revenue to the district’s capital improvements fund this year, as the district is trying to bolster its reserve. The district added around $1.2 million in tax revenue to the capital improvement fund last year.
Property tax revenue accounts for more than a third of the district’s overall budget. If the district collects 100 percent of property tax revenue, the district is expected to add $23.2 million to its general incidental fund and $2.43 million to its debt service fund for the 2022 tax year.