LPOSD starts supplemental levy talks

PONDERAY — Just as school teachers hand out grades to students, school districts get their own marks as well.

The Lake Pend Oreille School District received an A-plus on its annual financial audit by Magnuson, McHugh and Company, a tax, accounting and financial firm in Coeur d'Alene.

Chris Shipley, a certified public accountant with the firm, delivered the grade to LPOSD during Tuesday's board meeting at the Ponderay Events Center. Lisa Hals, the district's chief financial and operations officer, was praised by Shipley for "flawless" preparation for the audit. It was clear, Shipley said, Hals prepared the financial overview throughout the year.

"You cannot just hurry up and prepare at the year end for an audit," Shipley said. "So I can say with a good amount of certainty that, as your school year progresses and as Lisa and her staff have prepared knowledge and information for the board, that you're taking good numbers throughout the year."

Following Shipley's presentation, Hals presented the financial overview to "set the stage" for discussion regarding the district's next supplemental levy, which will go to voters on March 17. The current two-year, $15,767,484 levy covers one-third of the district's operations and expires June 30. Hals said in fiscal year 2016, the supplemental levy funds $2,386 per student in the district — the statewide average is $720.

"The successful replacement of our current levy is absolutely vital to the district's functionality," Hals said.

Hals broke down the departments where supplemental funds are used, the majority of which goes to staffing costs at approximately $6.4 million per year. Other areas where supplemental funding is used include technology at $405,000 for the 2016-2017 fiscal year; curriculum at $321,000; student activities, which Hals said is 100 percent funded by the supplemental levy at $254,651; and maintenance at $432,419.

Although board members will not begin deliberation regarding the details of the next ballot measure until December, Hals presented several "assumptions" to illustrate "how important the net taxable value of the school district is" when it comes time for deliberation. For example, taxpayers with a home valued at $100,000 are currently paying $176 per year toward the supplemental levy. Assuming the supplemental levy dollar amount remains the same over the next levy period at $7,883,742 per year, with a projected net taxable value annual growth of 2 percent, a taxpayer with home valued at $100,000 would pay $173 in fiscal year 2017-2018, and $169 by fiscal year 2018-2019.

Assuming the supplemental levy rate remains the same at $176 with a 2 percent growth in net taxable value, the additional dollars generated for the district would be $126,114 in fiscal year 2017-2018, and $286,311 in fiscal year 2018-2019. Hals presented the same assumptions with numbers for 4 and 6 percent net taxable growth as well.

The district is now eligible for a permanent supplemental override, Hals said, which is a separate ballot measure that would, as the name suggests, make the supplemental levy permanent. According to Idaho law, a school district qualifies for a permanent override after seven consecutive years of voter-approved levies that account for more than 20 percent of the district's general fund.

Chairman Steve Youngdahl said he is against a permanent supplemental override and wanted to forewarn board members so it would not come as a surprise later when or if it comes up in deliberation.

"I will continue to be against it and it is for a really simple reason," Youngdahl said. "I think this process is very healthy; I think this process is necessary and it makes us scrutinize every aspect of this budget."

A supplement levy timeline is available on the district's website at lposd.org, outlining the meeting schedule for the next five weeks. The timeline notes dates and changes of some regularly scheduled district meetings as well. The financial overview prepared by Hals is available on the website as well.

The next board meeting is rescheduled for Tuesday, Nov. 1 at 6 p.m. and will be held at the district office, 901 Triangle Dr. in Ponderay. LPOSD staff members Matt Diel and Matt Brass are scheduled to give presentations on the facilities and technology departments.