July 9, 2014 10:52:17 AM
Starkville School District Superintendent Lewis Holloway said he hopes SSD and city aldermen can find an amiable solution over how to use $500,000 in over-collected school taxes.
Although a 1986 general obligation bond for school district improvements was retired in 2006, approximately $474,081 was discovered in a city account this spring as a result of over-collections. Officials last week said that due to changing statutes and tax-collecting and --paying authorities in the '80s, it is believed the over-collection occurred because the original millage rate to pay off the principal and interest was not adjusted after property value reassessments. Compounding interest helped balloon the amount.
Mayor Parker Wiseman said last week that he approved a transfer of those funds to the school system, but the city was in the process of recalling the funds after Vice Mayor Roy A. Perkins said the move was made without board authorization and instructed the city attorney to investigate all legal avenues to reclaim the money.
As of Tuesday, the money had not yet been returned to the city.
An attorney general's advisory opinion states the city can place those funds in its general fund for the upcoming fiscal year if aldermen offset taxes -- about 2 mills -- in the same amount, but Wiseman is seeking further AGO clarity on if SSD can legally keep the money.
Complicating the matter is the fact that voters outside the city limits but inside SSD's territory approved the bond. County residents who approved the action would not experience a tax break from the city if Starkville reclaims the money.
Members of the SSD Board of Trustees met behind closed doors Tuesday to discuss legal matters believed associated with the situation, but no resolutions emerged from executive session. Holloway and board members Keith Coble and Juliette Reese also met with aldermen in executive session last week, but again no actions emerged from the closed-door talks.
The combined 1986 bond issue provided a principal amount of $4.26 million for enlarging and repairing Starkville High School and asbestos removal from school district facilities. Almost $1 million of those funds were specifically earmarked for remodeling and equipping the Greensboro Center, which previously served as a high school and middle school.
Almost 30 years after the bond issue, the Greensboro Center again needs repairs. A March study performed by the Nashville, Tenn.-based Structural Design Group states inspectors found "advanced decay" associated with roof trusses above the facility's auditorium; green growth, mud and other evidence of water infiltration; and deterioration associated with the building's facade and masonry.
Holloway said structural repairs, along with asbestos abatement, could proceed if the district is allowed to keep the almost $500,000 voters approved for Greensboro Center repairs.
"I feel that's the right thing to do since that's what people voted on. We have people in the county that voted on this. Where's their say on how the money is spent?" he asked following Tuesday's school board meeting. "We have public hearings, mayoral debates, hospital discussions (in the facility's auditorium); Starkville Academy even uses it for their own plays. The Greensboro Center is a structure that is used by the entire community. Since that's what voters raised money for, it seems to be proper to use it for that purpose."
Last year, aldermen increased taxes from 20 mills to 21.98 after previously forecasting an almost 3-mill increase to cover rising costs, raises and an increase of Starkville Parks Commission's funding so it could rein in late electric bill payments.
Taxes could again increase next fiscal year due to a number of potential maneuvers, including a call by the Golden Triangle Development LINK for the city to issue $5 million in economic development bonds for a new industrial site near the Miss. Highway 182 and Highway 25 bypass.
Aldermen could also consider purchasing Cadence Bank's downtown location for Starkville Police Department's future home. The city did not list a potential price last week during a report on the matter from Chief Administrative Officer Taylor Adams.
SSD approved a 65.24-mill tax levy Tuesday to cover costs in its upcoming fiscal year, a slight increase from FY 2012-2013's and FY 2013-2014's 62.96-mill rate. The system's expenditures increase by $7 million for construction costs, a line item covered by a previously approved levy the school board passed in anticipation of renovation projects prior to state-mandated consolidation in 2015.
Property taxes are calculated with mills. One mill is worth one-thousandth of a dollar. For example, if the millage rate is 20 mills, you would pay $20 for every $1,000 of assessed value on your property. The assessed value of a property is the appraised value multiplied by the assessment ratio (10 percent for residential properties). A property assessed for $100,000 in this example would pay $200 in taxes.
Municipalities, counties and school districts each establish their own millage rates to meet budgetary needs.
Carl Smith covers Starkville and Oktibbeha County for The Dispatch. Follow him on Twitter @StarkDispatch
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