Q-C schools get ready for new statewide sales tax
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By Sheena Dooley | Monday, June 30, 2008 |
Exterior pod renovation continues at Bettendorf Middle School and is being paid for with a 1-cent tax that goes from being a local tax to a statewide tax on Tuesday. School district officials expect the renovations to be completed before school starts in August. Buy this Photo
School districts in the Iowa Quad-Cities stand to collect hundreds of thousands of dollars more each year than they originally anticipated for the upkeep and construction of schools thanks to a new state law that takes effect Tuesday.
State lawmakers passed legislation this spring that scratches the one-cent local option sales tax, which voters in every county in Iowa have approved and pumps millions of dollars into school building projects, and replaces it with a statewide sales tax. Under the new law, districts won’t need to ask voters every 10 years to renew the tax and will see the amount of money they can collect increase.
Currently, the state caps the amount they can collect at
$575 per student. That figure is estimated to increase to more than $750 per student starting July 1. In the next five years, officials said they expect that number to continue to escalate as the pot of money generated by the statewide sales tax grows.
For local Iowa districts, that difference breaks down as
follows:
n Davenport School District expects in the first year to collect $12.7 million, which is
$3.5 million more than it would get under the old law.
n Bettendorf School District anticipates it will receive more than $3.2 million, which is more than a $800,000 increase.
n Pleasant Valley School District officials estimate the tax will generate $2.7 million, an increase of about $700,000.
n North Scott School District will receive more than an estimated $2.3 million, or about $550,000 more than it would have under the local option sales tax.
“We never had to borrow money for projects,” said Jim Spelhaug, Pleasant Valley superintendent. “We always had put together our plans where we would (set aside) the dollars for the project as it began. With the $575 we were entering into the stronger possibility of not being able to do that. Or we would have to delay the projects longer than we wanted.”
District leaders said the additional dollars will allow them to expand their list of projects, which include at least one new school and building renovations and additions. It will also lessen the likelihood they will have to take out bonds, which carry interest, to fund their more expensive projects, they said.
In total, Scott County districts will receive an estimated $20.9 million in 2010, when the new law takes effect for them. The statewide tax starts Tuesday, but won’t affect local districts for another year when the 10-year local option sales tax voters in the county approved in 1999 expires.
The new law has a sunset date of 2029, when the General Assembly will have to vote to renew the legislation in order for schools to continue to receive the money. Residents in Scott County had approved a 10-year extension of the local option sales tax earlier this year, which guaranteed their districts funding through 2009.
“That additional 10 years is what will really open the door to long-range planning and being able take on significant issues,” said Tim Dose, North Scott superintendent.
Lawmakers originally approved the local option sales tax about a decade ago as way to reduce property taxes and provide money for school districts to pay for building projects. Local districts have used the money to add air conditioning, renovate and add classrooms, improve security entrances, and make schools more energy-efficient, among other things.
“It’s a nice thing for us,” said Maxine McEnany, Bettendorf’s director of business and finance. “There are no cons. To get the extra money — that’s almost a million more a year to put into our buildings. We will be able to do quite a bit more.”
Sheena Dooley can be contacted at (563) 383-2363 or sdooley@qctimes.com. Comment on this story at qctimes.com.
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