1. Ad Valorem Tax Issues Cheree Brown, Itawamba County School District
Sheryle Coaker, Petal School District
David Rubenstein, Moss Point School District
February 14, 2012

2. Topics State vs. Local Funding Process and Authority 55 Mills Cap
Fee Collection
Payments
Success Story

3. State vs. Local Funding

4. Does less state funding (Governor Proposed underfunding MAEP by $330M) mean more local (Ad Valorem) funding?

5. Assessed Valuation
8%, 3% to less than ½%

6. Assessed Valuation Decrease From Prior Year
Fiscal Year
Number of Districts
2009 42
2010 49
2011 68

7. Shortfall Notes Fiscal Year Number of Districts 2008 22 2009 34 201046
2011 51
Increasing over the last 4 years

8. 55 Mills Cap Fiscal Year Number of Districts 2008 16 2009 17 2010 13
2011 19
19 = 12.5%

9. 50.00 to 54.99 Operating Mills Fiscal Year Number of Districts 2008 20
2009 19
2010 30
2011
1/3 of school district at 50+ mills

10. Between the economy (assessed valuation) and lack of state funding do school districts have the flexibility to increase local funding to survive?

11. Process and Authority

12. New Budget Year: Build Your Base!
Base starts with collections from October through September ( fiscal year of levying authority NOT the school district)
For FY , will use collections from October 1, 2011 through September 30, 2012.
Portion of base will be an estimate
Clearly show in calculation actual collected amount and estimated amount

13. A district may use any of the three previously completed fiscal years:
A district may use any of the three previously completed fiscal years: (Oct 1, 2010 thru Sept 30, 2011)
(Oct 1, 2009 thru Sept 30, 2010)
(Oct 1, 2008 thru Sept )
Add Homestead Exemption received during the base year used. Estimate September payment, based on payment received in March.
Add Ad Valorem Tax Reduction funds received FYE This allocation amount has been received from MDE even though all may have not been received yet.

14. Add Tax escrow at June 30, 2011 if used in FY 2011- 2012 and request was reduced by that amount
Add Proceeds of shortfall notes issued for FYE
Deduct any escrow at FYE
(Remember you will either add a shortfall amount at or deduct an escrow at You will not do both!)

15. THESE ADDITIONS AND DEDUCTIONS EQUAL THE BASE
To the base can be added the % increase.
Less than 4%, only board approval
If increase is between 4% and 7%, a petition can bring the increase to a vote and majority of the voters must approve for increase to be approved
If the increase is above 7% but equal to or less than what 55 mills would generate, the increase would have to be approved by 3/5 of voters in election.

16. An additional amount for New Programs allowed under may be added. Currently this amount is only the amount of increase in local contribution over the prior year.
Add New Property request.
Total for the district’s Ad Valorem Needs.
Reduce these needs by the amount of Ad Valorem Tax Reduction Grant To be received in FY

17. Further reduce by any Ad Valorem escrow if any at June 30, 2012.
The net amount is the Ad Valorem Tax Request for operations.
Calculate the Ad Valorem Tax request needed for Debt Service.
This request should be based on the need for each debt that a tax levy is assessed.

18. ADVERTISE TAX INCREASE
Remember that an increase in tax dollars must be published in a format that is specific by statute
New Programs or %
New Property (growth)

19. Know what the request does to your tax mills
Know how the request affects the taxpayer
Amend your budget as the estimates become actual
The Board of Education should approve the Ad Valorem request in dollars
Work with the levying authority to determine the latest time to submit the request Ad Valorem in DOLLARS!

20. 55 Mills Cap

21. If a school district is at the 55 mills cap and have a decrease in assessed valuation, then the district can request the same dollar amount in ad valorem tax effort as last year.
Source: Mississippi Code § (2)(a)
19 at cap

22. Fee Collection

23. Payments

24. Ad Valorem Tax Payments
The levying authority shall pay all taxes for the month to the school district by the 20th day of the next month.
Mississippi Code &

25. Questions
How many school districts gets their Ad Valorem Taxes on time?
How many school districts have more than one tax collector?

26. Success Story

27. Questions