Post date: Jul 20, 2013 7:24:32 PM
Oklahoma school districts are funded by annual property tax millages, which would NOT increase with approval of this bond issue.
By state law the district can only receive 35 mills for its general fund and 5 mills for its building fund. That funding level is not sufficient for any new construction nor large-scale renovations, especially when state formula aid funding has declined by 17% over the past five years.
Bartlesville patrons approved a $30.5 million bond issue in 2001, a $30 million bond issue in 2007, and a $12.7 million bond issue in 2012, so its additional "sinking fund" millage is about 27 mills. That extra millage is devoted to project areas outlined in the respective bond issues and CANNOT be spent for any other purposes.
The 2013 $36.7 million seven-year bond issue is designed so that the "sinking fund" millage would be kept as steady as possible at approximately 27 mills. As old bonds from the earlier bond issues roll off, they would be replaced by new ones, keeping property taxes steady.
You can think of it as a property-tax version of the sales taxes Bartlesville residents regularly vote to renew every so often to fund economic development and perform citywide infrastructure projects.
How does a continuing sinking fund rate of 27 mills translate into dollars?
For years property owners in the school district have been paying a levy of 27 mills for district’s sinking fund, which is dedicated to projects in voter-approved bond issues. The bond issue would maintain that rate. How that translates into dollars depends on the assessed valuation of the property.
To determine the annual amount being paid, you first have to obtain the “net assessed valuation” by calculating 11% of the “taxable market value” of the property. Many homeowners qualify for a “homestead exemption” which reduces the resulting amount by $1,000. Then you multiply the new value by 0.027, since 27 mills translates to 27/1000, to obtain the annual tax being levied.
For example, a home with a taxable market value of $100,000 would have a net assessed valuation of 0.11 * $100,000 = $11,000.
But a homestead exemption reduces that by $1,000, and $11,000 - $1,000 = $10,000.
Then we multiply by the appropriate millage: 0.027 * $10,000 = $270.
So that homeowner is currently paying (and, if this proposal is approved, they would continue to pay) $270 per year (which equates to $22.50 per month) in property taxes to the district’s sinking fund to pay off bond issues for school improvements.