The time has come to hurry up and wait. Like other public school districts, Marshalltown is waiting for the state legislature to decide on the level of state supplemental aid (SSA). On Monday, the Iowa House Appropriations Committee advanced an amended version of Senate File (SF) 2201 which would raise SSA to 2.25 percent, .5 percent higher than the previous suggested amount of 1.75 percent and .25 percent higher than Gov. Kim Reynolds’ proposed two percent.

The SSA is a key aspect of the certified budget process for the school district. Executive Director of Finance & Operations Randy Denham told the school board during Monday’s meeting that the legislature had discussions about meeting the 30-day SSA deadline.

“That passed last week,” he said. “We’re still pretty much in a hurry up and wait scenario on that. Regardless, as I mentioned at our last meeting, due to our loss of enrollment this past year, SSA would need to be at least 2.59 percent for the district not to be on the Budget Guarantee, which gets us up to at least 1 percent increase from the prior year and that Budget Guarantee is funded 100 percent through property tax in the school finance formula.”

The district will send info for property tax statements to the county auditor/recorder by March 5. The auditor/recorder will then mail those statements to residents. Denham said he believes there is legislation revising property tax statements.

“The effective tax rate tends to cause a lot of confusion for folks,” he said. “The effective tax rate takes the current property tax and divides it by the upcoming budget year valuations. It’s a calculation that can be done, but doesn’t really mean anything. The analogy I have used for the effective tax rate in the past is basketball season, March madness is coming. It’s basically taking the amount of three-pointer shots Caitlin Clark made this year and dividing it by the number of attempts she takes next year. Yes, you can calculate it, but it doesn’t really equate to much of anything. . . . I tell people (to) look at the current compared to the proposed, and that’s the difference you need to look at.”

Denham said if taxes are going up, they are required to provide taxpayers an explanation. For MCSD, taxes will go up. He said the increase is mainly due to low SSA and decreased enrollment. Those two factors mean the district will be on the budget guarantee and will need to levy cash reserves to fund special education and ELL (English Language Learners) costs, which are not funded by the state.

Denham said that at the March 2 meeting board meeting, they will get the ball rolling on $3.6 million in general obligation bonds for the Reimagine Miller project. They will be issued in the next two months and will be paid off before the end of the fiscal year.

“That was done so we could save on interest costs and allow more available funds for the project, thus saving tax dollars we would have to levy in future years,” he said.

Then in the spring, the district will issue $30 million of general obligation bonds for the project. That process will begin in either May or June, and the district will not sell or issue the proceeds until the summer.

Denham stressed that property tax dollars and tax rates are only estimates at this time based off of SSA information they have. However, the district still has to adhere to the statutory deadline and have information to the county auditor/recorder by March 5.

“Legislative action can still result in changes,” he said. “For example, an SSA of 1.75 versus 2 percent, that will have a bit of an impact on the tax rate, and any other law changes which may come into play. Property tax reform is another one, and that still has not been finalized yet.”

Denham said they tried to be as conservative as possible to give them room to lower total tax dollars levied if needed.

“Overall, the main takeaway is right now our current estimated max tax rate for fiscal year 2027 would be $18.23,” he said. “This would be an increase of $2.27 from our current tax rate of $15.95. Again, that increase is due to the low SSA and declining enrollment that results in us being on the budget guarantee, which is property tax funded. Also, the increases that we have in our special ed and ELL that aren’t funded through state dollars and have to be funded through property tax.”

Denham added that he did calculations on a $200,000 assessed home would be an annual increase of $98.70, or an increase of $8.23 per month.

Reductions

He also spoke about a target of $2 million in budget reductions from the general fund for next year. The reductions have not yet been finalized, but he expects it to be done in the next few weeks. Currently, they have identified $1.5 million in reductions without reducing people.

The reductions include:

• $500,000 participation in the Break Fix Insurance Program. Denham said this shifts maintenance and repair costs from the general fund into the management fund;

• $265,000 in early retirement savings;

• $268,000 by shifting non-instruction program software costs from the general fund to the SAVE fund;

• $212,000 by scaling back summer school and Ladders to Learning, which is an afterschool tutorial program;

• $73,000 through discontinuing various software licenses;

• $65,000 through eliminating sign-on bonuses;

• $40,000 by discontinuing the Community Support Advocates Program for school based therapist oversight. Denham said the program was in place because it was required for therapists to have oversight;

• $40,000 for attrition of an unfilled security officer position;

• $21,000 termination of the supplemental EAP program with BHS;

• $19,000 through moving the attendance coordinator from a 260-day to a 210-day contract;

• $16,000 by sharing a career ready counselor with Marshalltown Community College;

• $15,000 by discontinuing supplemental counseling support at Marshalltown High School and;

• $12,000 by switching to a new document shredding company.

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Contact Lana Bradstream at 641-753-6611 ext. 210 or lbradstream@timesrepublican.com.