Voters asked to approve schools’ operating tax

Oxford Schools officials are asking voters to approve an operating millage proposal on the Aug. 2 primary election ballot.

The operating millage is a 10-year, 18.4442-mill operating tax on all non-homestead property in the district. If approved, it would be levied from 2017 through 2026.

Non-homestead property includes businesses, commercial and industrial properties, second homes, vacation homes, rental properties and vacant land not adjacent to an owner’s homestead property. Excluded are principal residential (homestead) and qualified agricultural properties.

Oxford district voters first approved the 18-mill tax in 1996 and then renewed it in 2006.

According to Superintendent Tim Throne, the district would lose a major source of revenue if the millage proposal fails.

“This (millage) represents somewhere around 10 percent of our (general fund) budget. If this doesn’t pass, (the district) would have to make a tremendous amount of cuts. To give you an example, our transportation is somewhere in the $2 million mark (compared to a loss of) over $5 million here (if the proposal fails.) We could cut all of transportation and still not have enough to balance our budget… so this is really important,” said Throne.

State law, under the Headlee Amendment, allows districts to levy up to 18 mills on non-homestead properties for operating purposes. One mill is equal to $1 for every $1,000 of a property’s taxable value.

A key provision of the Headlee Amendment requires a district to reduce its millage when annual growth on existing property is greater than the rate of inflation.

This Headlee rollback reduced the district’s non-homestead operating to the rate of 17.8078 mills as of July 1, according to Barna. The current non-homestead operating rate expires in December 2016. Without the millage renewal, the district will be unable to levy it next year.

If the proposal passes, the millage rate would remain at the 17.8078 mills until July 1, 2017 when the rate would reset to the full 18 mills.

Although 18.4442 mills is being requested on the ballot, Barna explained that would not be the amount that would be levied.

“We can’t levy (more than 18 mills) in any given year,” said Barna. “What (the extra .4442) does is get us back to the full 18 to make us whole. It’s a renewal. But at no point can we levy over 18 in a given year. I don’t want people to think ‘Wait a minute! You can’t levy over 18!’ We’re not doing that.”

According to Throne, the state will not provide additional funding to the district, should the millage proposal fail. Part of Michigan’s system for funding schools is based on the expectation that a district will collect the full 18 mills every year, even if they don’t. This amount is subtracted from the per-pupil foundation allowance each district receives from the state.

“Right, wrong or indifferent, the state assumes that local schools will levy the full 18 mills, so that’s what we’re asking for,” Throne said.

If the tax is approved and levied at the state-allowed maximum 18 mills next year, it is estimated to generate $5.35 million in revenue, according to the ballot language.


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