After holding the line in the face of declining revenue in recent years, the Gwinnett County Board of Education anticipates having to raise the tax millage rate to fund the FY2014 budget.
The school board adopted a FY2014 balanced budget totaling $1.76 billion, a decrease of $12.8 million or .7 percent from the FY2013 budget at its meeting Thursday (May 16) at the Instructional Support Center in Suwanee. The board also tentatively adopted an increase of 1.30 mills in the tax rate.
Despite “a tremendous downturn in the economy we’ve been able to have the millage rate unchanged for some time,” Rick Cost, chief financial officer for Gwinnett County Public Schools, said.
This increase includes .55 mills for maintenance and operations (General Fund) and .75 mills for debt service. The .55 mills increase would fund eliminating two employee furlough days and adding 18 school resource officers recommended by Supt./CEO J. Alvin Wilbanks, Cost said. The reduced property tax base can no longer support the required debt service payments, he said, necessitating the .75 mills increase.
One resource officer would be added for each school cluster, including the Duluth and Peachtree Ridge clusters.
The FY2014 budget also reflects:
- About 85 additional teacher positions due to growth in enrollment
- Increases in employer health insurance costs for employees and employer contributions to the retirement system.
- Continuation of a hiring freeze to the extent possible
- No restoration of 54 central office positions eliminated in FY2013
- Continuation of budget cuts implemented over the past four years
Student-teacher class size ratios remain the same for the 2013-14 school year for the first time in the past five years.
The current millage rate of 20.55 has been in effect for eight years in a row, Cost said. The tentatively adopted 1.30 mills increase would raise the tax rate to 21.85 mills. The total millage rate would be comprised of 19.80 mills for maintenance and operation and 2.05 mills for debt service. The final millage rate will be adopted in June after the school system receives the final 2013 tax digest from Gwinnett County.
The property tax digest is expected to decline by 2.5 percent from the prior year’s budget resulting is a loss of $10.3 million at the current tax rate. The tax digest has declined 26 percent over the past five years equaling a loss of $143 million in annual property tax revenue.
A $9 million increase is local revenue is anticipated or 1.8 percent. GCPS is expecting an additional $7.8 million from the collection of the new vehicle “Title Tax Fee.” However, the school system estimates losing about $10 million in sales tax revenue next year due to the elimination of this tax on newly purchased vehicles, which would affect funds for capital projects.
As a result of the 1.30 mills increase, the owner of a $150,000 home would pay an estimated $76 more in school property taxes than last year, according to figures provided by Cost. A 150,000 home in 2013 had a value of just over $197,000 in 2008, and its owner paid $316 more in school property taxes in 2008 than it would pay in 2013, he said.
The General Fund in the FY2014 budget totals $1.258 billion, an increase of $29.7 million or 2.4 percent. The average expenditure per student equals $7,458, an increase of $102 per student or 1.4 percent. This is based on a projected enrollment of 166,667, representing an increase of 1,690 students or 1 percent.
Seventy-one percent of the General Fund budget is devoted to instruction. General administration and business/central support services comprise only 6.3 percent of the total operating budget, a decrease of .5 percent from FY2013.
Adoption of the budget followed two public hearings (May 9 and May 16) and two public work sessions (April 16 and March 30) on the proposed budget. The second public hearing was held just prior to the May 16 regular meeting.