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South Tama Middle School plan explained

January 31, 2020
By South Tama Board of Education members , Toledo Chronicle, Tama News-Herald

B ySouth Tama Consolidated School District Board of Education

Penny Tyynismaa,


Mandy Lekin

Vice President

Ron Houghton

Director District 1

Alan Kline

Director District 4

Clint Werner

Director District 5

On March 3, community members will vote on three ballot questions. If all three are approved, the South Tama County Community School District will be able to build a new middle school without raising property taxes .

The purpose of this letter is to explain each of the ballot questions and to answer questions you may have about the financing of the project.

Ballot Question 1: Voters will be asked if the district can borrow $20.8 million toward building a new middle school. The purpose of this question is to ask permission to borrow money and to explain what the district will do with the money, which is to construct, build, furnish, and equip a middle school addition next to the existing high school .

Ballot Question 2: Voters will be asked if the district can increase the levy limit from $2.70 to $4.05. The purpose of this question is to generate enough money to pay for a middle school.

When calculating compliance with levy limits, you are not allowed to factor in the planned use of sales tax revenue for property tax relief. However, we want to be clear that increasing the levy limit will not result in an overall property tax rate increase, due to the District's ability to utilize sales tax to reduce the overall levy rate. Permission to use state sales tax revenue is asked in Ballot Question 3.

Ballot Question 3: Voters will be asked to approve an updated Revenue Purpose Statement.

This is necessary because the new Sales Tax law put an automatic "sunset" on the District's current revenue purpose statement as January 1, 2031. The purpose of this question is to grant the district permission to use the statewide sales tax revenues (also known as "SAVE") towards construction projects. The ability to structure the District's planned commitment beyond 2031 allows the District to keep the overall property tax rate increase from occurring.

In summary, the district will use sales tax revenues - not property taxes - to keep the overall levy rate from increasing. This means state penny sales tax dollars will essentially "buy down" the property tax impact of the project.

There are two other ideas to keep in mind: 1) The district automatically receives state sales tax revenue each year, meaning that sales taxes will not go up as a result of this project and 2) state sales tax revenue is not dependent on locally generated sales tax revenue.

Finally, we are proud to say the South Tama CCSD is in a strong financial position to incorporate this plan. Keep in mind that our property tax has not increased since 2012, and we actually just decreased property taxes by $.78 for the 2020 fiscal year. All this has been done without cutting staff, programs, or services. Very few school districts in Iowa can make this same claim.

We understand that financing a middle school project without raising property taxes can get complicated. However, as a board, we are confident that the solution described above represents the best-possible option to replace our 104-year-old middle school.

We look forward to engaging the community in more conversations about this proposal and the future of South Tama CCSD in the weeks to come.



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