Our View: Coming tax hike a result of poor fiscal management by county schools




Monday, the Lowndes County School District voted to raise local taxes by four percent to ensure it had the reserve funds required by state law.


Based on projections, the district's reserves would be roughly $500,000 short of the state-recommended 7.5 percent of its $60 million budget.


The 1.3 mil tax increase will produce a little more than $600,000, which will resolve the immediate shortfall.



The board considered cutting expenses - primarily through personnel cuts - but ultimately decided to raise taxes instead.


It is, indeed, a bitter pill to swallow.


As recently as five years ago, district officials were practically giddy over their financial state, looking to millions of dollars in tax revenue increases from county industry as their income converted from fee-in-lieu payments to full taxes.


So confident were the officials, that they proceeded with a $44-million bond package to build a new school at New Hope High School, a state-of-the-art career tech center and other improvements throughout the district. Voters were told there was plenty of money coming to pay off that debt service. In fact, they said, there was a possibility that the debt could be paid off long before the 17-year term.


The district seemed to be rolling in cash. Money rolled in. Money rolled out, too, based primarily on those tax revenue projections.


What the district did not consider was that the projections were just that. When circumstances changed - some industries avoided the full-tax burden by claiming exemptions on depreciation or moving expenses from one phase to another and a Supreme Court ruling on airport property taxes, since resolved, shorted income by $800,000 last year.


Unfortunately, last year isn't the only year the district has operated at a deficit.


Put simply, the district has lived beyond its means, operating at budget deficits since 2016, dwindling a once-robust fund balance of $17 million to just $4 million.


District officials may cite faulty revenue projections, but it's clear they knew they were spending beyond their means for the past three years.


At any point during that time, the district could have adopted a more conservative fiscal policy, taking the necessary steps to resolve this situation. Instead, it chose to wait until a problem became a crisis.


The chickens came home to roost Monday.


By Monday, the situation had so deteriorated, the district had few options but to raise taxes.


Make no mistake, however: This is a crisis that could have - should have - been averted through wise management of its revenue and taking steps to correct the problem as it emerged.


The district did neither.


Ultimately, the school board must accept the blame.


But it is taxpayers who will pay the cost.




printer friendly version | back to top







Follow Us:

Follow Us on Facebook

Follow Us on Twitter

Follow Us via Email