Do You Own the School?

It's hard for our youngest students to conceptualize what it is exactly that I do. They understand that teachers are in charge of the classroom and that the principals are the 'boss', but when they learn that I am the principal's boss; well that is typically beyond the grasp of their little minds. A few years back, one of the kindergarten students was convinced that my job title was 'Intendent' and that I was just really good (you get it, right?). Last week I was stopped in the hallway and asked if I owned the school. No, I said. But your mom and dad do. You want to talk about a concept that is well beyond their comprehension!

It's true though. All of us who pay property taxes have an ownership stake in this school district. We are all investors in this great enterprise. What then, should be our expected ROI? In his 'Notes on the State of Virginia' written in 1781, Thomas Jefferson argued that public education was essential for preserving a free, stable republic by preventing tyranny and ensuring informed citizens. He also proposed that a system of taxes should pay for the education of the public, arguing this is far cheaper than paying the costs of a corrupt government. 

So what, and how does that apply to 2026? I kind of think about it like this. Preservation of the republic? Sure, if we want to keep this system running for the next 250 years, we would be wise to make certain our young citizens are well versed in what it is we aspire to in our continuing quest for the more perfect union. But as a more practical matter, we need youth ready to take the reins from us when we hang up the saddle. To keep things running smoothly while we enjoy our golden years. Have the tools and skills necessary to solve the problems we haven't gotten to yet. In 1848, Horace Mann penned his essay on public education, 'The Great Equalizer of the Conditions of Men'. In it, he suggested that our great educational enterprise is the supplier of artists, presidents, nurses, doctors, and leaders of our armies. 

Today then, I want to spend some time talking with you about that investment for the fiscal year that will begin on July 1, 2026; just mere days from the 250th anniversary of the Declaration of Independence! That investment of course being the property tax levy for the new year. As I shared with you a year ago, the property tax statement that is going to be landing in your mailboxes over the next few days isn't going to give you a whole lot of useful information. It is confusing and isn't at all user friendly. For more information on how to interpret that statement, please refer to my post 'Understanding Your Property Tax Statement'. Or, better yet you can go to our website and calculate your property taxes using this calculator that I think is pretty user friendly. The table to the right depicts the property tax rate for fiscal year 2026 and the proposed property tax rate for fiscal year 2027. The proposed rate for fiscal year 2027 is $17.20512. By clicking on that icon, it will take you to the calculator where you can input your property valuations in the shaded cells. There are directions included to help you find your valuations, but if you need any help, please don't hesitate to reach out! Now, be careful! If you change any of the other cells it will mess up the formula. If that happens, I would recommend simply going back to the original link and downloading a new calculator. The middle section of the calculator assumes your property value remained the same from one fiscal year to another. I can promise, your property value did not stay the same. This sample is merely meant to illustrate the impact of the rollback percentage, which is the current way property tax relief is delivered in state code. Keep in mind the legislature continues to contemplate property tax reform so I anticipate these rates will change depending on the outcome of the legislative session.

Now the fair question to ask is why are property taxes increasing and comparatively speaking, why does it seem like Hudson is higher when compared against other taxing authorities? The answer is somewhat complex, so I'll to break it into three main points.

The first thing to understand is that geographically (and comparatively) speaking, the Hudson Community School District is small. At roughly 57 square miles, our district is one of the smallest in the state. Furthermore, outside of what is considered 'in town' we are pretty sparsely populated. Moreover, there are very few commercial businesses inside the district to increase the overall property valuation. The more commercial enterprises in a taxing authority, the higher the valuation. This means the tax burden is spread out. Because of our lack of commercial real estate, the tax burden is carried primarily by residential property owners: that's you and me. In Iowa school finance, this is what is known as a 'property poor' school district. Not to be confused with socio-economic status, this merely refers to overall gross property value and the lack of industry to share the tax burden.

Which leads to the second point. All along what we refer to as the northern tier (for the sake of this discussion, I'm going to further isolate this tract of property to that between highway 20 and Ridgeway Avenue). All of this property is in what is known as a TIF (tax increment finance) district. TIF is an economic development tool used to encourage commercial development (yes, this is in the Hudson Community School District). The incentive works a bit like this: you build a business and we'll give you property tax rebates for twenty years. Think about this: the total value of all the property in our district is $311,993,952. I know, it's a lot. But here's the rub. Just $239,432,018 is used to calculate property taxes. So, $72,561,934 or $23% of our property value is in TIF districts. Among the highest in the state. What does that mean for you and me? It means your property tax rate would be $1.48 lower than what it currently is. 

The last piece that I want to talk about is funding our special education programs. Funding for special education programs is very different from general education programming and is largely governed by the federal IDEA. Each student has an individualized plan that is developed by a team that includes teachers, administrators, and parents. Essentially, if the team decides a particular service is warranted, we are required by federal law to make those accommodations. This may include a specialized school, transportation, nursing services, paraprofessional services, and even some equipment. Spoiler alert: it is very common in Iowa for school districts to operate special education programs with deficit spending. Hudson is no different. Now, depending on the level of services needed, each of these students will have extra 'weighting' applied to them. A regular education student generates 1.0 funding: $8,283. Depending on the level of services needed, some students may generate up to 3.74: $30,978. That's a lot, right? Well everything that I mentioned above can come with a price tag upwards of $90,000. Now, we have asked the state to change these weightings for decades to no avail. Because of that lack of movement, the overage (or deficit) is paid by you and me.

Mann closes his 1848 essay like this, "Education, then, beyond all other devices of human origin, is the great equalizer of the conditions of men, the balance wheel of social machinery...For the creation of wealth, then-for the existence of a wealthy people and a wealthy nation, intelligence is the grand condition". That, is hopefully our return on investment. 

Separating the Wheat from the Chaff

This time of year I sometimes have to remind my younger colleagues to take a breath and not get too worked up about what is going on in Des Moines. As one of the more 'seasoned' in the group, I know too well that we can run ourselves ragged trying to keep up with all of the bills that are filed during the early part of the legislative session, some of which are downright ludicrous. Inevitably, the neighbor of a legislator doesn't like how School District 'X' handles a particular situation in their school district, so the obvious solution is a legislative fix. More often than not, the proposed solution is quite the doozy and the legislator who filed the bill probably agrees. They are just being responsive to a constituent and realize that bill won't see the light of day. Unfortunately these bills oftentimes become the source of a great deal of stress and ill advised emails to said legislator. Admittedly, as a young superintendent I often fell for the trap until bequeathed the gift of experience. Until we reach the first funnel deadline it is a little bit like the wild west in the halls of the capitol. The statistic I heard recently was that somewhere in the vicinity of 1,500 bills will be filed in advance of the first funnel. According to the latest bill tracker on the Iowa Department of Education website, there are more than 75 bills with a direct impact on education. But alas, only about 10% will ultimately reach the finish line. As of last Friday, February 18th we have met that first milestone.

The funnel is meant to begin separating the wheat from the chaff. In order for a bill to stay alive for consideration, it must clear a committee in the Chamber of origin. The process goes a little bit like this. A bill is introduced, and then assigned to a subcommittee of three legislators. The majority of those legislators (two) have to agree to forward it to the full committee. The full committee votes, and if the majority agrees it clears the funnel and remains 'alive' for consideration. In all honesty, this is a pretty low bar. But, it is also a signal to start paying a little more attention. For me, up to this point I have been a pretty casual observer of the legislative process. I'll pay attention from the distance. If I think feedback will be helpful for legislators to understand the impact of a particular bill, I'm happy to oblige. However, I'm not commenting on every 'tin foil hat' idea that is proposed. What I have learned over the course of my tenure is that my opinion isn't really relevant or germaine to the debate. Facts on the other hand, well they can have an impact, particularly if they come from the genuine position of wanting to help. So I don't focus on the silliness, choosing to ignore that completely. We have folks in Des Moines representing us whose primary mission is to seek out and kill these bills. (That's a pro tip for the youngsters who may be following this blog.)

Granted, whatever has met that first low hurdle still has quite a way to go before it gets to the governor's desk. It is incredibly hard for a bill to become a law! Nevertheless, it is a signal to become a bit more attuned to what is transpiring in Des Moines. 

As we have previously discussed, property tax reform continues to be an area of priority this session and I am continuing to monitor those bills. But now that we are through the first funnel, I'd like to spend a bit of time today discussing a few bills that stick out to me and to consider some emerging themes. 

For starters, there are a number of bills with overlapping ideas; which suggests this is a priority area in the legislature this session. Among them are very prescriptive proposals for content that would become required in schools. Now, I understand the desire to add graduation requirements for such things as computer science or adding an additional unit of civics. I can also recognize the noble intent of adding additional physical activity requirements for recess at the elementary. But. Yes there is always a 'but'. Notwithstanding the fact that all of these proposals are unfunded mandates (despite the final paragraph of the bill proclaiming they are not), the one variable that is immovable no matter what: is time. Our school day is 405 minutes long. Each of those minutes has a purpose, whether designated as literacy time, physics class, lunch, recess, or even passing time between classes. Fitting something else into our day is more than an unfunded mandate. It means something else will need to go. Unfortunately, proposals never say, "Stop doing 'X' so you can start doing 'Y'".

One bill that I am particularly interested in learning more about is HF2451. This bill aims to limit the amount of 'school digital instruction limits' that elementary students (those as defined in grades K-5) are permitted. The proposals would mandate students could use these type of devices for no more than 60 minutes per day. Rumors had circulated prior to the start of the legislative session this would be a topic and the next logical step after the promulgation of state law one year ago restricting student cell phone access during instructional time. 

Even though we have reached the first funnel deadline and 'winnowed the field' so to speak, there is still a long way to go before any of these proposals end up state law. We've reached one milestone with many more to go. I'll continue to monitor their progress and keep you apprised. In the meantime, let's not get too worked up about anything yet!