Mark Rydberg: Financial impact of investing in schools
October 29, 2007
There have been many questions related to ballot question 3A.
I would like to explain what the financial impact would be to the residents and businesses of Moffat County in supporting the capital projects that are planned for our schools.
Question 1: What will this investment cost for my residential and commercial property?
On a typical assessed home in Moffat County of $150,000, the tax impact will be $61 per year, or $5 per month to support major capital improvements. For a typical assessed commercial property of $210,000, the tax impact will be $312 per year, or $26 per month.
Question 2: Will the passage of 3A do away with TABOR tax limits?
Absolutely not. The ballot question complies with TABOR, which by definition sets specific limits on taxes collected. (To read the full text of the ballot question, please visit http://www.ourkidsourcommunity.com.) TABOR limits taxes in 2 ways: (1) how much can be collected annually, and (2) how much can be collected over the life of the issue. For 3A, the District cannot collect more than $2.7 million in any one year, and cannot collect more than $54 million over its life. So, $2.7 million multiplied by 20 years equals $54 million. This is what it will take to pay off the $29.5 million bond over 20 years.
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Question 3: Why do you only refer to the principal amount of $29.5 million and not the full payoff amount that includes the interest on the $29.5 million?
Again the full amount, principal and interest, of $54 million is at the top of our ballot question. I would draw the parallel of buying a new house. One usually quotes the purchase price of the house, not what will actually be paid off over the life of the mortgage.
Question 4: So, after the bond is paid off in 20 years, will the school board be able to continue to collect tax money from this ballot?
Absolutely not. After the bond is paid off, the specific mill associated with this issue will end.
A concluding thought:
One of the five guiding principles used by the School District to develop a bond question was that the tax impact had to be reasonable. I understand that “reasonable” has a different meaning to different people, but I believe that $5 a month is a reasonable investment to improve our schools.
Lastly, please visit the website http://www.ourkidsourcommunity.com for a residential tax calculator. By inputting the amount on your notice of valuation sent from the County Assessor’s office this summer, you will be able to find your specific tax impact for supporting 3A.
Moffat County School District Finance Director