Wednesday, March 7, 2012

Budget Hearing Set

The Board of Director's have set March 19, 2012 as the date of the budget hearing for the fiscal year beginning on July 1st.  This hearing will begin at 6:00 in the Board room located in the Central Office.  During this hearing I will be sharing with the community how the budget is prepared and how property taxes are figured. The proposed budget was included in the March 8 edition of the Hudson Herald.

In my November 2 blog post, I spent some time discussing how the residential rollback works and how it impacts your property tax.  If you look at the chart that is included below, you will notice that the average property value of a citizen in Hudson is $157,684.  For the fiscal year that begins on July 1, 2012 the proposed tax rate is $16.48982, which is a tax rate decrease of .40794.  If you property value remained the same, you would see an annual property tax increase $26.56.

You may be wondering why this is considering the rate is decreasing by almost forty-one cents.  The answer is because of the rollback.  On that $157,684 home your taxable valuation is 48.5299%, or $76,523.89.  Next year on that same home, your taxable valuation is 50.7518%, or $80,027.47.

As I mentioned in my earlier post,  the Governor and legislature are working on property tax reform.  There is a very specific desire on the part of the Governor to decrease commercial property tax under the theory that this will increase economic development.  While this is being debated, it is important to remember and understand that this could impact residential property taxes.  Lowering one property tax classification could have the unintended consequence of shifting that tax burden to another property tax classification.

During the development of the school budget, the Board carefully considers tax rates and works hard to minimize the tax burden on the citizens of the Hudson Community School District.  On behalf of the Board of Director's and the students of our school district, I sincerely thank you for your financial support of the schools.  Our schools remain strong because of the support you show.

I just want to point out a few things about the proposed budget that you see on the left-hand side of the screen. You will notice that line number 23 shows an increase of 6.2%.  We have increased this line in the budget to accommodate for unknown expenses that we anticipate in our special education program for next year.  You may recall a recent article in the Waterloo-Cedar Falls Courier that talked about the dissolution of the special education pool in the AEA.  Beginning July 1, all special education costs will be borne by the district as opposed to being spread out across all pool schools.

You may also notice an increase of 5.4% on line number 31A.  This is attributed to a greater emphasis on several buildings and grounds projects that we will have in various stages of completion over the next year.  Our high school parking lot and elementary electrical upgrade are scheduled for this summer, both projects will spill over into the next fiscal year.

Take note of line number 35A, where you notice a 20.4% decrease.  The reason for this decrease is attributed to the fact that our bonds were refinanced a year ago to take advantage of historically low interest rates.  During this refinancing, the original bonds were paid off and re-issued.  The best news of all is that after we complete our bond payment this year, we will only have two remaining payments!

Those are the highlights.  Again, the budget hearing will be conducted at 6:00 on March 19 in the Board Room. 

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