The Duluth School Board on Tuesday night set the preliminary tax levy for next year at the maximum level allowed by the state, but whether that amounts to an increase or a decrease isn't yet known.
Because the school district's current voter-approved operating levy is expiring, the total levy amount will fall if voters don't approve a new one Nov. 5. Approval of the first question would keep the same operating levy amount that residents have been paying, but their entire school tax bill would go up about 6 percent because the district hasn't sold excess properties like Rockridge Elementary and Central High School as planned. Taxpayers are now paying more of that Red Plan debt that in the past was paid through the reserve fund, now drawn down too far.
If the second operating levy question is approved, the overall levy could increase about 12 percent. If nothing passes, the levy could go down 2.4 percent as the operating levy -- in place since 2003 -- would be off tax bills.
The operating levy is part of the general fund, which is one of three components of the total levy. The other two are community education and debt service. The debt service portion is where district officials have said this year's and last year's tax increase comes from because sales from most former schools and other excess properties aren't yet able to pay down their portion of debt as originally planned.
Last year's December levy increase was 11.9 percent. That levy brought in $28.9 million to the district and meant about $45 more per year for the owner of a $150,000 home. Failure to pass an operating levy -- sometimes called an educational levy -- would reduce that number to $28.2 million. If the first operating levy question passes, the district would receive about $30 million in total levy revenue. With the second question, it would receive about $31.8 million.
The board voted 5-1 to approve the measure, with member Art Johnston opposing.
A vote to renew and increase the operating levy is being held to put money into hiring more teachers to lower class sizes and improve curriculum and programs throughout the district. Record-high class sizes and cuts to programs from years of budget reductions have been top education issues in Duluth schools in recent years.
The state increased its per pupil funding to school districts by 1.5 percent for each of the next two years, and in 2015 Duluth stands to gain about $4 million in additional state funds through special education increases and all-day kindergarten funding.
But cuts to federal programs such as Title I and integration, an increase in district pension contributions and expected deficits in the $2 million range in the coming years slice into those investments, officials have said.
The board will set the levy Dec. 17. It could reduce the levy before then but it cannot raise it.
The board also approved Tuesday the city's request for an easement at the former Central High School, meant for a pedestrian and bike trail along the property. The issue had been tabled for a couple of months. The approval is contingent on being granted the rezoning that the district wants to make the property more attractive to potential buyers.
Member Ann Wasson said the issue was tabled because the board wanted the City Council to take action on the rezoning issue.
"I'm hoping that will come," she said. "It's a win for all of us if we can get this property sold."