Pipeline tax revenues a big factor in forecasts
The biggest variable in the five-year general fund forecast for the Woodmore school district is the anticipated revenue from the Nexus pipeline, says Dan Russomanno, district treasurer.
The preliminary assessed valuation of the pipeline in the Woodmore district and Woodville Township is slightly more than $48 million.
The total valuation of the pipeline county-wide is about $257 million. School systems and townships along its route are scheduled to start receiving public utility property tax revenues from the pipeline in February 2020.
But Russomanno and other treasurers and fiscal officers are cautious about using those figures in their projections because Nexus has until Dec. 7 to appeal the valuation to the Ohio Department of Taxation.
Adam Parker, a spokesperson for Nexus, said the company is reviewing preliminary valuation assessments.
“Consistent with how individuals, homes and businesses are taxed, we believe that the Nexus property tax assessment should reflect the true market value of the pipeline. Should Nexus find that the tax valuation does not accurately reflect the true market value of the pipeline, we may elect to appeal through the formal process established by the Ohio Department of Taxation,” he said.
Without Nexus, the total tax valuation of public utility property in the Woodmore district is about $8.6 million, which generated about $447,829 for the school system in fiscal 2019.
In his forecast, Russomanno projected Woodmore would receive about $920,000 in fiscal 2020 from public utility taxes, including a half-year of collections from Nexus. In fiscal 2021, with a full-year of Nexus collections, total public utility taxes would generate about $1.4 million.
Those figures reflect a much lower valuation for the pipeline than $48 million.
“A $48 million assessment would definitely give us more than the estimated projections,” he said. “I expect the $48 million to be dropped.”
Writing in the district’s latest newsletter, Russomanno says that while it is “reasonable to assume” the district’s allocation of state revenue will at least remain flat in the next state biennium budget, “the reality is that we do not actually know for sure at this time.”
He doesn’t expect the Nexus revenues to alter state funding in fiscal 2020 or 2021, he writes.
Jerri Miller, Sandusky County auditor, said Nexus has the right to only pay taxes on the appealed amount until the case is resolved.
Other taxing districts in the county and the preliminary assessed valuation of the pipeline in their jurisdictions are: Rice Twp. /Fremont schools - $3.1 million; Riley Twp. /Fremont schools - $31.5 million; Riley Twp. /Clyde schools - $2 million; Sandusky Twp. /Fremont schools - $32 million; Townsend Twp. / Margaretta schools - $106 million; Washington Twp. / Fremont schools - $16 million; Washington Twp. /Gibsonburg schools - $17.4 million.
Wood County
In Wood County, Matthew Oestreich, county auditor, has estimated public utility assessments will add about $350 million to the county’s total taxable valuation, making the Rover and Nexus pipelines the top two taxpayers in the county.
The Rover pipeline, actually two side-by-side pipelines, crosses through Bloom, Henry, Jackson, Milton and Perry townships.
With both Rover lines now in operation, the preliminary tax assessment is projected to increase to $255 million from last year’s $57.5 million valuation.
The preliminary assessed valuation of the Nexus pipeline, which crosses through Troy, Webster and Middleton townships, is $92.6 million.
But he also cautioned the figures are preliminary.
Pending no appeals, Oestreich said the county’s general fund will realize an increase of about $680,000 over last year.
He said pipeline valuations depreciate over a 30-year cycle.