Saturday, September 10, 2005

Complexities of the School Millage

School funding is hard to understand, and that’s not good for taxpayers. As a board member I will try my best to explain how things work. Birmingham Public Schools get most of their money from a formula dictated by the State Legislature, with additional funds through the support of our local homeowners who support the “Hold Harmless” millage (check the chart below for the items that make up school funding). Some facts:

• The “Hold Harmless” millage in Birmingham has been frozen at $3,877 per student since Proposal A was adopted as law in 1994. The amount ($3,877 per student) has never increased; it will never increase under Proposal A.
• Because the “Hold Harmless” millage is frozen at $3,877 per student, that millage rate has DROPPED as property values increase. The total amount of tax raised by the millage changes only as student enrollment changes.
• What does this mean? Local community tax support for schools (through the “Hold Harmless” millage) has been the same as it was in 1994; the only increase has come from the State and some increased student enrollment.
• Other local increases have come from new revenues generated by initiatives such as the Birmingham Conference Center at Groves, and through other rentals of school property.
• The other part of your tax bill shows the 6 mill state tax, 100% of that money goes to the State; the district has no control over those funds, or that millage.

Now comes the tricky part, Non-homestead properties. The State funding formula ASSUMES that the Birmingham School District taxes non-homestead properties at 18 mills and deducts that amount from what they send the district. We don’t want to collect anymore than what the state mandates we collect. However, each year non-homestead properties are subject to the “Headlee Rollback” provisions adopted by the State Legislature in 1978. Unless the district approves a millage greater than 18 mills on Non-homestead properties (and only the Non-homestead properties), the effective millage gets reduced each year and we are forced to hold an election each year to “over-ride” that rollback on the Non-homestead properties. If the Non-Homestead millage falls below 18 mills the State deducts the difference between the mandated 18 mills and the “rolled-back non-homestead” millage from our portion of State provided educational funding.

What’s it all mean? We do not want to increase any taxes, we only want to maintain the current level of school programs by renewing the existing homestead millage; remember – that millage has been and continues to be frozen at 1994 levels. We also want to renew the non-homestead millage to satisfy the State mandate that we collect 18 mills on Non-homestead properties – in order to do that we need to ask for a Non-homestead millage higher than 18 mills – because of the way the Headlee rollback language works. We will not collect more than 18 mills on Non-homestead properties, but we are forced to ask for more than 18 mills to prevent the cost of being forced into “over-ride” elections each year as some districts struggle to implement.

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