Embed Size (px)
Citation preview
MASA Great Start Workshop
Essentials of the Property Tax Levy Process & the Truth in
Taxation Hearting
Jeffrey M. Solomon, DirectorBaker Tilly Virchow Krause, LLP
Agenda
• Basis for the Property Tax Levy• Summer Data Submissions
• Proposed Levy• Truth in Taxation Requirements
• Final Levy Certification• Suggestions
• Help is Available
3
The District’s Property Tax Levy Represents the Local Share of Education Costs
4
Local Share of Formulas
School Board Initiatives / Decisions
Voter Approved Levies (Operating and Bond Referendums)
Minnesota School
Revenue2016-2017
Source: Minnesota Department of Education 5
Districts are Dependent on
State
6
• School Levies are Limited by State Law• Education is a State Responsibility• State is Concerned with Equity
(Common and Uniform System)
• Summer Data Submissions• Proposed Levy• Truth in Taxation Notice• School Board Discussion /
Public Input• Final Certification to County• Final Certification to MDE
Levy Calendar
7
March 15 – Aug. 27Sept. 30*Nov. 10 – 24 Nov. 25 – Final CertificationDec. 30 Jan. 7, 2020
See Detailed Calendar on MDE Website and Verify Dates: Levy Limitation and Certification Calendar
Summer Data Submissions
8
• Long-Term Facilities Maintenance• Health and Safety• ADM and LEP Projections• Health Benefits• Other Post Employment Benefits• Non-public Transportation• Elementary and Secondary Sparsity• Building/Land Lease• Bond / Interest Payments• General and Community Service Programs
Summer Data Submissions
cont.
9
• Referendum/Local Optional Revenue• Alternative Teacher Compensation (Q Comp)• Career and Technical• Disabled Access• Swimming Pool• Ice Arena• Re-employment• Capital Projects Referendum• Debt Service Excess• Etc.
Follow Instructions Provided by MDE
Proposed Levy
10
• Due: Sept. 30
• Requires School Board Approval
• Based on Data Submissions and MDE Data
• Levy at “Maximum”
• Initiates Truth in Taxation Process
Levy Limitation
Form
11
• Data
• Funding Formulas and Levy Authority
• Prior Years Adjustments
• Final Authority
• 40+ Pages of Numeric and Formulaic Bliss
Definitions
12
• Market Value• NTC – Net Tax Capacity• ANTC – Adjusted Net Tax Capacity. • Ag Modified ANTC for LTFM• Referendum Market Value• Sales Ratio• ADM – Average Daily Membership• APU – Adjusted Pupil Units
• Parcel Specific Notices– Prepared and Mailed by
County– Proposed Tax Compared
with Prior Year– Contact Information of
Taxing Entity– TNT Meeting Date and
Location
Truth in Taxation
13
• Public Meeting– Current Budget– Proposed Taxes – Tax Impact (Optional)– Public Comment
Budget
14
General Fund82.77%
Debt Fund6.44%
Capital Expenditures
3.88%
Community Ed. Fund3.18%
Capital Facilities Improvement
0.00%
Food Service Fund3.74%
Revenue by Fund
Budget
15
General Fund79.20%
Debt Fund7.01%
Capital Expenditures
4.65%
Community Ed. Fund2.80%
Capital Facilities Improvement
2.81%
Food Service Fund3.52%
Expenses by Fund
Tax Impact –Property
Types
16
• Residential– Homestead– Non-homestead
• Apartments• Commercial/Industrial• Seasonal Recreational• Agricultural• Other
Tax Impact – Levy Comparison
17
Proposed 2019 Pay 2020
Payable2018 Pay 2019
$ Change
% Change
General 2,550,598.42 2,632,842.11 -82,243.69 -3.22%Community Service
370,456.17 348,830.26 21,622.91 5.84%
Debt Service 5,104,948.61 4,795,300.38 309,648.23 6.07%Total Levy 8,026,000.20 7,776,972.75 249,027.45 3.10%
Tax Impact - Example
18
202333
463593
1233
256422
587752
1562
0
200
400
600
800
1000
1200
1400
1600
1800
100,000 150,000 200,000 250,000 500,000
Market Value of Homestead Residential Property
Property Tax Comparisons – Pay 2019 Versus Pay 2020
2019 2020
Final Certification
19
Adopted by School Board
Submit to Home County Auditor by Dec. 30
Submit to MDE by Jan. 7
Suggestions
20
• Use the MDE Website, Program Finance, Levy Certification
• Verify all Data Whether Submitted or State Generated
• Emphasize Accurate, Realistic Projections and Estimates
• Review Adjustments from Prior Years• Compare Levy Limitation with Prior Year/s
(Historical Data)• Follow the Calendar Provided by MDE
Suggestions cont.
21
• Understand the “Cost” of an Underlevy• Approve Proposed Levy at “Maximum”• Be Prepared for TNT Meeting• Use TNT Presentation as an Opportunity to Share
Financial Information• Certify Final Levy at Exact Dollar Amounts• All Data Submitted Electronically
Help is Available
22
• Attend Levy Workshop (I hope you did)• MDE• Your Predecessor and/or Business Manager• School District Auditors• Financial Advisor• Neighboring School Administrators• Professional Organizations
The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought.
Baker Tilly Virchow Krause, LLP trading as Baker Tilly is a member of the global network of Baker Tilly International Ltd., the members of which are separate and independent legal entities. © 2019 Baker Tilly Virchow Krause, LLP.
DISCLAIMERATTENTION
24
