Written by Kelly Kaczala
May 04, 2012
The Oregon City Schools District, which is continuing to lose revenue due mostly to lower property valuations, may want to consider a levy sooner than later, according to Jane Fruth, treasurer of the district.
The value of placing a levy on the ballot this year is the millage would be lower because the district would be collecting it sooner, said Fruth at a school board meeting last month.
“In 2012, the district would need a 5.9-mill levy,” she said. “In 2013, it would go up to 8.3-mills for the same financial impact in our district. So that’s the only reason to consider it.”
The board, in deciding whether to place a levy on the ballot, would also have to consider if it would compete with other issues on the ballot, according to Superintendent Mike Zalar, such as the renewal of the permanent improvement levy.
“I think the board needs to consider the timing of that renewal as well as any anticipated operating levy in the future,” said Zalar.
Oregon City Council, it was noted, has discussed the idea of a new recreation center that may have to be supported by a levy.
“There are other things that are happening in the community, other issues that perhaps you are aware of,” said Fruth. “I don’t know what’s going on with the rec center. But the sooner you’re on the ballot, the lower the millage rate. That’s the only reason to do it.”
“As of yet, we have not had that discussion as a full board as to what would be most appropriate,” said Fruth.
Board member Jeff Ziviski asked whether the board has curbed spending from the Permanent Improvement fund.
Board member Carol Molnar said the district has curbed spending.
But P.J. Kapfhammer said spending this year is more than last year.
“I’ll defend the money we are spending,” he said. “We’re not curbing our spending. There’s a lot of things that need to be done in this district, and we’re spending that money. We’re spending it in the right places.”
Earlier in the meeting, Fruth painted a bleak outlook for the district’s finances.
“I’ve been a broken record on this, our valuations have declined,” said Fruth in her treasurer’s report. “We are losing 35 percent of our residential property values and 25 percent of commercial properties. Comparing the 2011 collections to 2012 collections through the auditor’s estimates, we’re going to be losing approximately $830,000 this year.”
The district will save approximately $450,000 in insurance costs, which will offset the $830,000 loss, she said.
Typically, the district pays an increase of 12-15 percent in insurance rates, but the renewal this year saw an increase of only 5 percent, said Fruth.
“So a 5 percent renewal is a good thing,” she said. Since she had estimated a 15 percent increase in the district’s five year forecast last October, a downward adjustment means a savings of about $450,000.
“I did update the forecast - that we are looking at our estimates for future levy needs if they should be there,” she said.
The district also hopes to save money by refinancing a $2.5 million debt, she added.
“We’re hoping to save about $25,000 per year, which would be helpful as well,” said Fruth.
Still, the district is struggling financially as the state continues to cut funding to schools.
“We’re getting ready to fall off a cliff as the state continues to take away the `hold harmless’ money,” she said.
The legislature is considering eliminating hold harmless funds beginning in 2014.