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Reassessment Continues To Rock Schools
(posted 6.21.09)
The ripple effect from the 2007 reassessment continues forcing local schools
into temporary borrowing situations to meet operating expenses. The delay
in collecting property taxes is costing taxpayers thousands of dollars
in additional interest.
Speedway's public schools have been forced to borrow again in 2009 to meet
expenses. Last year, the school system borrowed about $6.4 million and
has only been able to repay about $4.8 million. School Superintendent Ken
Hull expects the loan to be repaid by September now that the 2008 tax bills
have been mailed.
"The interest on these borrowed funds is slightly over 2%, and the
real cost in interest from June of 2008 to June of 2009 is approximately
$66,361. This total amount of interest expense will increase (+$7,000.00)
between now and the final payment in September of 2009. This is the genuine
expense that taxpayers are being caused to realize because of the reassessment,"
Hull said.
"Regarding the publications for 2009, property taxes billing and collection
has not even begun for 2009 thus causing a second year of delayed receipts.
The school corporation will now need to borrow funds to operate in 2009.
This amount will not exceed $1,872,661. This is much less than was needed
in 2008, but is still a significant amount of money and the interest percentage
on these 2009 loans will likely be higher than on the 2008 loans. These
are additional expenses (interest - unknown at this time) that taxpayers
will be realizing because of this ongoing situation." The legal notice
to borrow funds that the district is required to publish listed interest
rates as high as 6.5%.
The Metropolitan School District of Wayne Township is still lacking about
$17.4 million from 2008 taxes, according to Director of School and Community
Service Cheri O'Day. The district gave legal notice on June 10 to borrow
$6,671,552 for the transportation fund, $18,480,165 for debt service, and
$10,466,349 for Capital Projects for the 2009 school year.
The school is also taking other action to reduce expenses. "We are closing each Friday in an attempt to cut down on utility costs at each building. The high school still has classes on Fridays, but only for the month of June," she said.
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