Columbia school board to appeal tax levy decision

Sunday, May 23, 2004

COLUMBIA, Mo. -- The Columbia School board has decided to appeal a court ruling that said the district illegally set its tax rate high enough to collect more revenue than the district's declared needs.

The Missouri Court of Appeals ruling, issued Tuesday, might have implications for other school districts, cities and counties, school attorney Alex Bartlett said Friday before the board voted to appeal.

The ruling means the eight taxpayers who brought the case are due a collective refund of $77.52 for taxes paid during 2001-2002 budget year.

Lead plaintiff Henry G. Lane has said the goal of the lawsuit was to show that the Columbia district violated a Missouri law requiring school districts to set tax rates "calculated to produce substantially the same revenues as required in the annual budget."

Bartlett said the ruling seems to suggest a school board must assume it will collect 100 percent of revenue from its funding sources, particularly property taxes. If that's the case, he said, boards will have to create contingency funds to cover likely budget shortfalls.

The Columbia school district assumes that a percentage of property taxes will not be collected in any given year. For example, in 2001 the district assumed that 6 percent of property taxes would not be collected and set its tax rate higher to compensate. The court questioned that practice.

Bartlett argued to the court that had Columbia lowered its tax rate to the level Lane suggested, the Department of Elementary and Secondary Education would have considered it a voluntary rollback and reduced the district's state funding. But the judges said that point should be decided by a court, not state education officials or finance experts who advised the district.

Missouri School Boards Association spokesman Brent Ghan said he was pleased that Columbia would continue pursuing the case.

He said Columbia's budgeting practices are not unusual.

"In fact, it is only prudent for districts to budget on the conservative side, plan on receiving a little less in local revenues," he said.

Lane has said he still hoped the lawsuit could gain class action status so all taxpayers could recover amounts overpaid -- about $1 million. He said Friday he had not determined his next legal step.

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