If the $47 million school bond is approved by voters, it will mean property taxes could go up, but residents arenâ€™t likely to see an increase until next year, Lincolnâ€™s county manager said.
County commissioners will begin ironing out the 2004-05 budget soon, and with that process comes wrestling with a growing school debt.
County Manager Stan Kiser has said that the additional debt the county will accrue should voters approve the bond will mean property taxes will have to go up by 4.8 cents over the next three years, raising the tax from 62 cents to 66.8 cents per $100 valuation.
That means that a resident currently paying $620 tax on a $100,000 home would pay $668 with the increase.
The $47 million bond plus a $36 million bond voters approved in 2000 equals a total $83 million the county would have to pay back.
During 2003-04, Lincoln County paid about $5.95 million in school bond payments. With the addition of the $47 million bond, that number will jump to $7.21 million in 2004-05. By 2006-07, it should be around $9.39 million.
This increase is outside the normal operational expenses the county faces.
The decision to keep the tax rate at 62 cents is tied to the fact that 2004 is a revaluation year, he said.
â€œTo me, in a revaluation year, thatâ€™s enough,â€ Kiser said. â€œThatâ€™s more than enough for citizens to have to deal with.â€
The county will have to dip into its fund balance to cover expenses, Kiser said, but wouldnâ€™t say how much would have to be taken out.
Last year, commissioners voted to take $2 million out of savings to cover costs. But because of some departments coming in under budget, itâ€™s not likely that total amount will be used.
With the additional school debt, the total amount the county owes is growing.
In 1999-2000, county debt was $9.6 million and school debt was $27.4 million. School debt spiked to $55.6 million in 2003-04, with the countyâ€™s debt rising to $10.1 million.
Debt is expected to reach a peak in 2005-06, when school debt will be more than $93.7 million. The countyâ€™s debt, on the other hand, should decrease to about $7.9 million, barring any capital projects.
For the coming fiscal year, some of the county departmentsâ€™ proposed budget requests were cut. Kiser said he had to cut requests by about $2.1 million.
â€œThereâ€™s no money to fund everything,â€ he said. â€œYou just have to make choices, and schools have just taken priority. Debt of any kind takes priority.â€
Commissioners have the final say on the budget, which has to be approved by July 1.
If the bond is not approved, the county will have to pay for the improvements anyway, Kiser said, likely starting with the proposed elementary school in the west. The other projects would have to be considered in order of need.
The alternative form of payment to a bond would be Certificates of Participation, or COPs, Kiser said. COPs typically carry an interest rate that is about one-half percent higher than general obligation bonds.
The county is researching ways other than raising the property tax to increase revenues and deal with group, including a real estate transfer tax. But getting that approved by the General Assembly will be a struggle, officials have said, and could take some time.by Alice Smith