School board can’t agree on tax rate

With board member Allen Jenkins absent Tuesday night, the Grady County Board of Education was deadlocked and could not agree on a tentative ad valorem tax millage rate.
The delay in setting a tentative millage puts off the required public notice advertising and could result in penalties leveled by the Georgia Department of Revenue if Grady County Tax Commissioner Phyllis Gainous misses an August 1 deadline to submit the tax digest and approved county and school millage rates to the state.
Grady County commissioners adopted a tentative millage at their July 2 meeting in order to start the required advertising process and allow the tax commissioner time to finalize the submission for the Department of Revenue and have it in Atlanta prior to the August 1 deadline.
On Tuesday night Board Vice Chairman Scott Higginbotham and board member Jeff Worsham voted against Superintendent Lee M. Bailey’s recommendation to set the tentative millage at 14.4 mills, which would actually generate less tax money than was collected by the school system in 2012.
School System Finance Officer Dan Broome explained to the school board members that even if a 14.4 mill rate was set as the tentative rate the board could vote in two weeks to lower it to 14.2, but once the tentative rate is set it cannot increase.
The superintendent called on the board to end what he refers to as the “tax on teachers.”
For the last several years the board has cut teachers and administrators as well as non-certified staff by a minimum of five days pay and has cut local supplements.
The board has discussed dipping into its cash reserves to pay school system employees a lump sump equivalent to three days of the five furlough days, but Superintendent Bailey noted that would still result in approximately $500,000 that the board was cutting from teachers. That money the superintendent says is equivalent to a tax on teachers.
“When considering the millage rate you have to look at the amended formula adjustment, which is what we used to call austerity cuts. That’s ($3,161,506.00) we will not receive from the state. That would take 6.5 mills of tax increase to generate that much money ourselves. In looking at this budget we aren’t buying any new buses and we’re using money from our savings, our fund balance, just to balance what we need. On top of that property values have decreased which will result in lower ad valorem tax revenue. We’ve also discussed the cost the county charges us to collect our taxes. Taking all of that into consideration we are operating in the red,” Bailey said as he made his case for the recommendation of 14.4 mills.
Even at 14.4 mills the school system would collect $83,661 less in school taxes this year than was collected last year. Under the proposal of 14.2 mills pushed by Vice Chairman Higginbotham and board member Worsham the ad valorem collections would be $181,962 less than in 2012 and that deficit would have to be made up from reserves.
Over the last four years school system revenues from ad valorem taxes has dropped by $328,565 due in part to not adjusting the millage rate combined with a tax digest that has dropped each year for five years.
The adjusted net digest has dropped from $594,847,520 in 2008 to $504,108,510 in 2013.
“I believe it is reasonable to use a combination of furlough days, some fund balance, and a millage rate adjustment. The 14.4 levy will not generate additional money. It will not even generate all we need on its own,” Bailey said.
“At our last meeting Dan (Broome) you said you were estimating we would end the year $500,000 to the good. Do you have that figure yet?” Worsham asked the school system finance officer.
Broome explained that he and his staff are working to close the books on fiscal year 2012-2013 and it could be another week or two before he had an exact figure.
“Well if we do have $500,000 extra that would put our fund balance at around $3.4 million in reserves and that is local money right?” Worsham asked.
Broome said that was his projection and he acknowledged the board could spend the reserves at its discretion.
The finance officer explained the procedures and advised the board the setting of the tentative millage had to be done quickly in order for the tax commissioner to meet the August 1 deadline.
Vice Chairman Higginbotham suggested the board call another meeting when the full board could be present and take action at that time.
Veteran board member Teresa Gee Harris voiced opposition to a delay and pointed out that even if the board set a tentative rate of 14.4 mills they could still vote in two weeks to lower it to 14.2 mills if that was the desire of the majority.
“It’s easier to decrease it than to increase it so why not let’s go ahead and set it at 14.4 and if when Allen gets back and you want 14.2 you can lower it,” Ms. Harris said.
Higginbotham then stated everyone knew 14.4 would not be approved to which Ms. Harris responded, “you can’t vote for him (Jenkins).”
The vice chairman and veteran board member then sparred over if board members Jenkins could vote over a conference call or if the superintendent could break the tie.
“Why delay it? You can always go down. Where is Allen anyway, sick?” board member Harris asked.
Worsham and Higginbotham confirmed Jenkins was absent due to illness and it was mentioned that he had suffered a back injury.
“I can tell you I’m not going to change my vote and he (Jenkins) is not either,” board member Worsham commented.
“I’d rather you not speak for him and let’s wait until he can speak for himself. I certainly wouldn’t want you to speak for me if I were not present,” Ms. Harris stated.
Board Chairman Drew Pyrz and Ms. Harris tried to push through a motion to set a tentative rate of 14.4 mills, but Higginbotham and Worsham voted no.
The vice chairman then offered a motion to set a tentative rate of 14.2 mills seconded by Worsham, but Pyrz and Harris opposed resulting in another deadlock.
Chairman Pyrz then called for a special meeting to be held next Monday, July 15, at 6:30 p.m. in hopes the full board would be present and a tentative millage adopted.
If the board can set a tentative millage rate early next week then final adoption would take place at a called meeting on Wednesday, July 31.
“It will be cutting it tight, but I guess I can get it done. I would rather have had a day or two to format everything and get it to Atlanta in time.If an error or question came up we would have time to address it before August 1,” Tax Commissioner Gainous said.
The meeting Monday night is open to the public and will be held at the VanLandingham Center.