Monday evening’s Madison School Board meeting included a fascinating and quite useful discussion of the way in which the district “grants” money to (or creates partnerships with) local groups via Fund 80 (Fund 80, or “Community Services” is money sourced from local property taxes that lives outside the state revenue caps. This means that Fund 80 spending can grow as fast as the School Board approves). The growth of Fund 80 spending has been the subject of some controversy during the recent past.
Props to the school board for discussing and addressing this matter.
Audio 13MB MP3
Much more about Fund 80 here [RSS]
Another factor that will drive property taxes is the changing real estate market. I noted nearly two years ago, that Madison had about 14,000 more parcels in 2005, than 1990. This creates a larger pie to spread government and school spending across. Slower or no growth in the property tax base may mean larger tax increases per parcel than we’ve seen in the past (along with flat state funding). Madison is considered a “property rich” school district, therefore we receive a much smaller percentage of our budget from redistributed state taxes and fees (this approach was referred to as the “Robin Hood Act” in Texas). The MMSD’s handy citizen’s budget notes that 65% of its revenues arrive via local property taxes. Finally, Madison’s property rich status means that any increase in spending beyond the revenue limits via referendums reduce state aids. For example, $1.00 of new referendum spending may cost local property taxpayers $1.60 or thereabouts. This concept is known as “Negative Aid”.
Related: K-12 Tax & Spending Climate.