Amelia Holliday Staff Reporter
August 20, 2013
HAZARD— The Perry County and Hazard Independent school boards voted last week to approve new property tax rates in their districts.
The Kentucky Department of Education gives districts three options to choose from concerning tax rates. Districts may choose to neither raise nor lower the previous year’s tax rate, however, depending on property values for the year this may impact tax revenues negatively; the compensating rate, which will ensure the district receives the same amount of revenue as it did the previous year; or the 4 percent increase which allows the district to only go 4 percent over the same amount of revenue accumulated the previous year.
Jody Maggard, financial officer for the Perry County district, said the precedent the board has set has been to always vote for a 4 percent increase.
“Predominately, the Perry County schools have always stayed with the 4 percent. There’s been one time since I’ve been here that we’ve not taken the 4 percent,” Maggard said.
This year, the board did not break the trend, and in continuing with tradition increased real property and personal property taxes for those in the district.
According to a legal notice in this week’s edition of the Herald, the district plans to raise the general fund tax levy from 48.2 cents per $100 on both real and personal property to 50.2 cents per $100. This raise is expected to generate $7.2 million in local taxes. A public hearing on the new rate is set for Sept. 5.
“If we take that 4 percent then we increase our revenue approximately $300,000,” Maggard said.
Maggard explained this would be the best idea for the district because with the other two options the schools would not see a substantial increase in revenue.
Superintendent Jonathan Jett said this option would also be better for the district as it plans to build two new schools in the very near future.
“We could take one cent (per $100) of that and hold it for construction, future construction, and at the end of the two years we would have somewhere between $2.5 and $3 million in bonding potential,” Jett explained.
Jett said the district is very close to being able to build both schools at the same time, depending on costs of land and the buildings themselves, and this increase in revenue could help to make sure the district doesn’t fall short of that goal.
“We want to be able to move on these projects quick. We don’t want to wait three, four, five years to start this,” he said.
The board voted 3-1 to approve the tax plan’s first reading, with Jerry Stacy being the only dissenting vote.
“It’s hard to raise taxes on anybody right now, especially with all the miners out of work. You know, $20 might not sound like too much to us, but I know a lot of people who it is a lot to,” Stacy said.
The board also voted unanimously to raise the sheriff’s collection fee rate from 3.25 percent to 4 percent for this year.
The Hazard Independent School District also voted last week to approve a new tax rate, taking a different route than the county.
Superintendent Sandra Johnson said the board approved the district to use the compensating rate, which would not increase taxes in the district, adding there was little difference in revenue between the compensating and 4 percent increase anyway.
“When you really look at the different rates, the difference in revenue between the compensating rate and the increase is roughly $34,000,” Johnson said.
Johnson said last year the board voted for the Nickel Facility Tax. For this reason, the board decided it would not raise taxes again this year.
“With the way the economy is, if we can leave things the way they are and not do another increase (we will),” she said. “I think our community, they do a really good job of paying their taxes, which really helps our school district. If a large percentage of the real estate and property owners in the district did not pay their taxes, then it would result in the board possibly having to make the decision to increase taxes and recover that loss.”