Truth I n Taxation Public Meeting Time 6:00pm Date 12/5/2019 at - PowerPoint PPT Presentation

2019 Payable 2020 Truth I n Taxation Public Meeting Time 6:00pm Date 12/5/2019 at the Winona City Hall 207 Lafayette St # 3533 Winona, MN 55987

T r uth in T axation L aw Minnesota’s Truth in Taxation Law requires that cities, counties and school districts follow certain steps before adopting a tax levy for the following year.  The law requires a mailed notice to each property owner in the county, which describes the tax levies proposed by the city, county and school district and what percent increase (decrease) such a levy would mean in dollars.  School districts are required to hold a single meeting in which the public is allowed to speak and the budget and levy is discussed. This meeting may be part of a regularly scheduled meeting but must occur after 6:00 P .M.  The meeting date and location must be provided at the same time or prior to certifying the proposed property tax levy. The meeting date must be between November 25 and December 27.  You are here tonight as part of the school district’s public meeting process.

Re quir e me nts of the T r uth in T axation Public Me e ting Discuss proposed property tax levy for taxes payable 2020 1. Provide and discuss information on the current budget (2019- 2. 2020). Public must be given a reasonable amount of time to comment 3. on the proposed property tax levy and budget and to ask questions. - Minnesota Statute 275.065

Points to Re me mbe r Revenue formulas are set by the State Legislature except for 1. voter approved referendums. Local Levy and State Aid mix are set by the State Legislature. 2. An increase in local taxes does not necessarily mean an increase 3. in revenues for the school district. - Minnesota Statute 275.065

Levy Cycles

Winona Area School District School District Budget Current School Year 2019-2020

F und Ac c ounting Ove r vie w All school districts’ budgets are divided into separate funds, as required by law. For our District, there are 7 funds: 1. GENERAL FUND (Fund 01)  Revenue is based on student enrollment  The local referendum levy is part of the General Fund  Provides for classroom instruction, instructional supplies and equipment, and other educational activities  Special Education, and State / Federal Mandated Programs  Extra-curricular Activities  Pupil Transportation  Facilities Operation and Maintenance  Capital Expenditures and Improvements  Health and Safety Code Compliance

F und Ac c ounting Ove r vie w 2. FOOD SERVI CE (Fund 02)  School Breakfast and Lunch Program 3. COMMUNI TY SERVI CE (Fund 04)  Levy is based on adult population in the District  Early childhood levy is based on the number of children under 5 years of age  Provides for enrichment programs for any age level that are not part of the K-12 education program  Early Childhood Family Education  School Readiness  Adult Basic Education 4. DEBT SERVI CE (Fund 07)  Based on annual debt retirement schedules for the district’s outstanding bonded indebtedness. Annual levy is for the payment of principal and interest on bonds as due. Current debt is a result of the voter approved Bond Issue for 2018.

F und Ac c ounting Ove r vie w 5. NON-OPERATI NG FUND (Fund 06)  Record all operations of the district’s building construction program  Funded by sale of bonds, capital loans, or major capital project costing $2,000,000 or more 6. FI DUCI ARY FUND (Fund 45)  Irrevocable trust funds related to Post-Employment Benefits 7. PROPRI ETARY FUND (Fund 20)  This fund is no longer used as of July 1, 2019  Not a required fund

Winona Ar e a Sc hool Distr ic t 2019-2020 BUDGET OVERVIEW REVENUES 18-19 19-20 Percent Actual Budget Change General Fund 44,112,921 41,069,784 -6.90% Food Service 1,646,382 1,755,500 6.63% Community Service 2,014,725 2,018,796 0.20% Debt Service 1,949,523 2,957,996 51.73% Non-Operating 9,825,596 1,036,346 -89.45% Fiduciary 389,048 526,099 35.23% Proprietary 212,967 - -100.00% Totals $ 60,151,160 $ 49,364,522 -17.93%

Winona Ar e a Sc hool Distr ic t General Fund Revenue Budget Where Do Our School Revenues Come From? Federal Aid 3.6% Local Taxes 22.0% Other Local 3.3% State Aid 71.1%

Winona Ar e a Sc hool Distr ic t 2019-2020 BUDGET OVERVIEW EXPENDITURES 18-19 19-20 Percent Actual Budget Change General Fund 42,302,043 40,707,297 -3.77% Food Service 1,750,336 1,787,334 2.11% Community Service 1,915,884 1,968,402 2.74% Debt Service 2,156,748 2,798,935 29.78% Non-Operating 1,239,038 4,597,661 271.07% Fiduciary 898,653 863,099 -3.96% Proprietary 204,262 - -100.00% Totals $ 50,466,964 $ 52,722,729 4.47%

Winona Ar e a Sc hool Distr ic t HOW ARE GENERAL FUND DOLLARS SPENT? Expenses incurred in the operation of the district are paid from the General Fund. The following schedule relates how the dollars allocated to the General Fund are spent: District & School Administration 3.6% District Support Services 3.1% Regular Instruction 34.6% Vocational Instruction 0.7% Special Education Instruction 27.0% Instructional Support Services 5.5% Pupil Support Services 13.3% Sites-Buildings, Equipment 12.1% Fiscal and Other 0.0% 100.0%

Winona Ar e a Sc hool Distr ic t General Fund Expenditure Budget What Do Our Expenditures Pay For? Supplies & Capital Materials 3.9% Expenditure 2.2% Other Expense 0.1% Purchased Service 18.9% Salary & Wages 55.4% Employee Benefits 19.5%

Winona Ar e a Sc hool Distr ic t School District Levy  2019 Payable 2020  2020-2021 School Year  Fiscal Year 2021

Winona Ar e a Sc hool Distr ic t Authority for School Levies A School District Tax Levy must be either: Set by State Formula  -or- Voter Approved 

Winona Ar e a Sc hool Distr ic t Factors I mpacting Tax Change I ssues Driven by Legislative Decisions:  Change in sales ratio (impacting ANTC)  Change in tax capacity rate structure  Laws mandating code compliance (Health & Safety and Buildings) I ssues Determined by District Voters:  Voter approved building bond issue  Voter approved excess levy referendum

Winona Ar e a Sc hool Distr ic t Factors I mpacting Tax Change ( cont .) Local Factors: Inflationary pressure on real estate market  Abatements  Property improvements not previously taxed  Change in individual assessed market value  Possible change in property classification (e.g.  homestead to rental)

Winona Ar e a Sc hool Distr ic t How will your 2020 school taxes be spent? Percent General Fund Provides additional funding for district instructional programs by means of the approved excess referendum. Provides funds for operating capital expenses, building/land lease, and Health & Safety costs: 70.5% Community Education Fund Levy for Community Education Programs: 4.2% Debt Service Levy for repayment of principal and interest on district debt: 25.3% Total Levy Before Credits: 100.0%

Winona Ar e a Sc hool Distr ic t LEVY LIMITATION AND CERTIFICATION 2019 Payable 2020 Comparison of Certified Payable 2019 Levy with Proposed Payable 2020 Levy GROSS LEVIES ACTUAL PROPOSED DOLLAR PERCENT BY FUND 18 PAY 19 19 PAY 20 DIFFERENCE DIFFERENCE General Fund 8,953,406.91 9,159,979.81 206,572.90 2.31% Community Services 559,976.36 541,843.98 (18,132.38) -3.24% Debt Redemption 3,865,542.57 3,299,709.84 (565,832.73) -14.64% Total 13,378,925.84 13,001,533.63 (377,392.21) -2.82%

Winona Ar e a Sc hool Distr ic t Major Changes to Levy Categories Category Pay 2019 Pay 2020 Change General Fund Operating Capital 365,361.00 323,477.00 (41,883.00) Leases 368,302.00 538,026.00 169,724.00 Long Term Facilities 1,215,677.00 1,538,416.00 322,739.00 Local Optional 1,248,426.00 1,984,212.00 735,786.00 Referendum Voter App 4,371,691.00 3,522,705.00 (848,986.00) Equity and Transition 359,734.00 336,107.00 (23,627.00) Other General Fund 1,024,215.91 917,035.81 (107,180.10) Sub-Total 8,953,406.91 9,159,978.81 206,572.90 Community Service 559,976.36 541,843.98 (18,132.38) Debt Service 3,865,542.57 3,299,709.84 (565,832.73) Total Change (377,392.21)

Winona Ar e a Sc hool Distr ic t What are the main variables that cause property tax increases and decreases? Changes in market values, classification or class • rates Change in property tax credits (e.g. change in • Homestead Benefit from a credit to an exclusion) Voter approved referendums • Increases or decreases in levy amounts caused by • changes in state funding formulas

Winona Ar e a Sc hool Distr ic t What are the main variables that cause property tax increases and decreases? ( con ( c ont .) The value of your property may increase or • decrease The value of other properties may increase or • decrease and change the share that your property is of the total tax base, whether your property’s value changed or not. School Board Actions. •