Growth in property value doesn't meet schools' projections

Already facing massive cuts in state funding, officials in local school districts are scrambling for ways to deal with yet another revenue letdown: a lack of growth in property assessment valuations.

Based on preliminary results, Cape Girardeau, Jackson and Scott City school districts all saw smaller growth than officials budgeted for 2003-04, resulting in the loss of hundreds of thousands of dollars in funding.

Cape Girardeau County Assessor Jerry Reynolds said the main reason this year's assessments didn't increase as much as projected was a lack of growth in area businesses, despite a $25 million increase in real estate.

"It takes a lot of individuals to make up for a loss in business personal property," Reynolds said.

Cape Girardeau's assessment did increase from the 2002 valuation, when there was essentially no growth in the district, to bring in an estimated $320,000 more than what was received last year.

Even so, the 2.3 percent growth did not meet the 3 percent increase projected by district officials. The result is around $100,000 less in tax revenue than officials had hoped for, a significant loss for a district that depends on local funds for 70 percent of its revenue.

"It's a huge disappointment," said Mark Bowles, superintendent of Cape Girardeau School District. "It means we'll have to continue to make cutbacks."

In Jackson, the 2003 assessment did hit the 5 percent growth that district officials had conservatively budgeted, amounting to around $357,000 in additional revenue.

"That won't even cover the $400,000 we lost from the state this year," said Dr. Ron Anderson, Jackson superintendent. "We can't be too optimistic now, the way the economy is."

The Jackson School District has averaged a 5 to 6 percent growth in nonreassessment years, Anderson said. In 2001, the last reassessment year, Jackson had a 13 percent growth in assessed valuation.

School officials say the valuations were especially surprising because 2003 is a reassessment year, a process that occurs every other year, and property values usually increase more during reassessment.

Total property valuations go up every year because of new construction, but in reassessment years, assessors reevaluate existing property where improvements may have been made in the intermediate year.

The preliminary property tax revenue that districts are using to prepare 2003-04 budgets are subject to change after businesses and individuals have an opportunity to protest to the board of equalization in July.

Only temporary gain

But in reality, Anderson said, any increase in tax revenue is just a temporary gain. It eventually is deducted from the amount of state funding the district receives each year.

According to Jim Morris, public information director with the Missouri Department of Elementary and Secondary Education, local property tax revenue is deducted from the aid a district receives from the state as a way to equalize funding for all districts.

"If districts get more local revenue one year, they're likely to receive less state revenue," Morris said.

Over the past seven years, the Scott City School District's assessments have grown an average of 5.45 percent each year. This year, the district only saw 3.5 percent growth.

Scott County Assessor Theresa Houchin said she believes the lack of growth is due to the current cost of living.

"People aren't building houses the way they were and businesses all over Scott County are closing," Houchin said.

cclark@semissourian.com

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