Truth In Taxation 2017 Payable 2018 Levy

and 2017-2018 Budget Presentation

ISD #381 Lake Superior School District

December 12, 2017

• This discussion is for the School District portion of proposed property taxes only.

• Each property tax statement has three entities that make up the final proposed tax bill. – County – City – School District – Each entity sets their own levy and has their own

public meetings.

The Levy Cycle

• District Board adopts the Final Levy in December 2017

• Property owners pay taxes in May 2018 and October 2018 based on the certification in December 2017

• Funding is recorded mostly in Fiscal Year 2019 for the District.

Referendum Market Value

• Tax base classifications excluded from RMV • The remainder of the agricultural property after the House,

Garage, and 1 Acre. • Non-homestead Agricultural Land • Managed Forest Land • Noncommercial Seasonal Residential Recreational • 55% of the Taxable Market Value of a Blind/Disabled Homestead

up to $ 50,000 • 50% of the first $600,000 of a Comm. Seasonal Residential Rec.

used less than 250 days per year and includes Homestead • 25% of Qualifying Low Income Rental Housing

Net Tax Capacity

• NTC includes all parcels of property in the school district. Formulas take into consideration the classification of the property (class rate), such as Homestead, Commercial/Industrial, Agriculture, Seasonal recreational, etc, along with the Taxable Market Value to come up with a NTC Value.

Lake Superior #0381 Payable 2018 Proposed Levy by Taxing Classification (RMV/NTC)

Payable 2018 Proposed (as of 12-07-17)

Lake Superior #0381 Levy Comparison by Levy Category

Payable 2017 Final Certified – Payable 2018 Proposed (as of 12-07-17)

Lake Superior #0381 Payable 2018 Proposed Levy by Category Payable 2018 Proposed (as of 12-07-17)

General - RMV Voter 0%

General - RMV Other 26%

General NTC Other 9%

Community Service 0%

Debt Serv. Voter 49%

Debt Serv. Other 3% OPEB Bonding

14%

Lake Superior # 0381 Taconite Production Impacts

Reasons why Proposed General RMV –Other Portion of the Proposed Levy Increased

Operating Levy adjustments in the $424 Local Optional and Board approved $ 300 going back to FY 2016

RMV OTHER Pay 17 Pay 18 Change

Local Optional $ 424 $638,082.30 $642,792.48 $4,710.18Equity $233,755.75 $237,349.71 $3,593.96Transition $20,375.24 $20,602.72 $227.48Board Approved $ 300 $283,873.80 $336,976.34 $53,102.54 TOTAL $1,176,087.09 $1,237,721.25 $61,634.16

Reasons why Proposed General NTC-Other portion of the Levy Increased

• Prior year Health & Safety Negative adjustment gone • Long Term Facility Levy Increased due to Formula Increase • Taconite Production Levy decrease was less this year

NTC OTHER Pay 17 Pay 18 Change

Student Achievement $29,726.58 $0.00 ($29,726.58) Law Change - Phased out after Pay 17Operating Capital $121,728.66 $114,000.05 ($7,728.61)Reemployment $239.10 $12,682.72 $12,443.62 Includes 5,683 of Adj from 2016Safe School $57,293.64 $54,663.12 ($2,630.52)Long Term Facility $439,579.60 $564,666.48 $125,086.88 Law Change - Formula Increase Building Lease $40,000.00 $40,000.00 $0.00Career Technical $50,729.77 $48,869.44 ($1,860.33)Tree Growth $976.39 $976.39 $0.00Health & Safety Adj ($49,199.58) ($0.01) $49,199.57 PY Negative ajustment removedDeferred Maintenance Adj ($191.69) $1,104.49 $1,296.18Taconite ($449,126.80) ($405,949.38) $43,177.42 Levy Taconite Reduction less in Pay18Abatement Adjustment $1,347.58 $2,117.13 $769.55 TOTAL $243,103.25 $433,130.43 $190,027.18

• Reasons why Proposed Debt Service Voter Approved Decreased

• County adjustment for Abatement less than prior year

• Reasons why OPEB Debt Service Decreased • Refinance of debt reduced future payments and created a

larger excess fund balance adjustment this year

• Reason why Debt Service Other Decreased • The debt excess reduction for fund balance was higher

this year than in the prior year and New refinance of old Capital and Alternative Facilities bonds.

Debt Retirement Schedule

Building Bond This debt levy is scheduled to come off the Levy on the Pay 2023 Levy. OPEB Bond This debt levy is scheduled to come off the Levy on the Pay 2027 Levy Capital Facility & Alternative Facility Bonds This debt is scheduled to come off the Levy on the Pay 2024 Levy

• 2017-2018 • BUDGET OVERVIEW

Lake Superior # 0381

Payable 2017 Final Levy as a Component of 2017-2018 Revenue Budget

Payable 17 Levy $4,756,903.69

22%

All Other Revenues $17,349,922.31

78%

Lake Superior # 0381 2017-18 Revenues by SOURCE Code

Local Sources $8,186,025.00

37%

State Sources $13,131,754.00

59% Federal Sources $780,047.00

4%

Other Local Sources $9,000.00

0%

Source (local source codes may be different) REVENUE % of Total Budget All Funds 001-099 601-622 Local Sources $ 8,186,025.00 37.03%

200-399 State Sources $ 13,131,754.00 59.40%

400-599 Federal Sources $ 780,047.00 3.53%

631-649 Other Local Sources $ 9,000.00 0.04%

Total Revenues All Funds $ 22,106,826.00

Lake Superior # 0381 2017-18 Expense by OBJECT Area ALL Funds

Salaries & Wages $10,986,863.00

48%

Employee Benefits $4,283,767.00

19%

Purchased Services $1,565,690.00

7%

Supplies & Materials $1,339,560.00

6%

Capital Expenditures $784,050.00

3%

Debt Service $3,703,280.00

16% Other Expenditures

$113,132.00 0%

Other Financing Uses $132,355.00

1%

Object EXPENSE % of Total Budget All Funds

100-199 Salaries & Wages $ 10,986,863.00 47.96%

200-299 Employee Benefits $ 4,283,767.00 18.70%

300-399 Purchased Services $ 1,565,690.00 6.83%

400-499 Supplies & Materials $ 1,339,560.00 5.85%

500-599 Capital Expenditures $ 784,050.00 3.42%

700-799 Debt Service $ 3,703,280.00 16.17%

800-899 Other Expenditures $ 113,132.00 0.49%

900-999 Other Financing Uses $ 132,355.00 0.58%

Total Expenses All Funds $ 22,908,697.00

Lake Superior # 0381 2017-18 Expense & Revenue Budget Comparison

01,03,05 02 04 07 08 45 47

By Fund Difference ($437,743.00) ($18,308.00) $7,320.00 $22,002.00 $125.00 ($281,451.00) ($93,816.00)

($500,000)

($400,000)

($300,000)

($200,000)

($100,000)

$0

$100,000

Fund REVENUE EXPENSE Projected Surplus/(Deficit) 01,03,05 General Fund $ 16,966,534.00 $ 17,404,277.00 ($437,743.00)

02 Food Service Fund $ 595,000.00 $ 613,308.00 ($18,308.00) 04 Community Service Fund $ 645,296.00 $ 637,976.00 $7,320.00 07 Debt Redemption Fund $ 2,925,482.00 $ 2,903,480.00 $22,002.00 08 Trust Fund $ 21,675.00 $ 21,550.00 $125.00 45 OPEB Irrevocable Trust Fund $ 118,000.00 $ 399,451.00 ($281,451.00) 47 OPEB Debt Service Fund $ 834,839.00 $ 928,655.00 ($93,816.00)

Total All Funds: $ 22,106,826.00

$ 22,908,697.00 ($801,871.00)

Questions or Comments??

ISD #381 Lake Superior School District

December 12, 2017