Mike Richie
TRSD District Administrator
Spirit Article, January 2023
Miscommunication Causes Excess Property Tax Increase
We understand many of you are concerned about the unexpectedly large increase to the school portion of your 2022 property tax bills. The reason for the increase is that a bond premium received by the district of $1,094,975.41 was not utilized to offset the tax levy. In calculating the estimated 2022 school tax increase for the Falcon STEAM referendum passed in April, the district's financial advisors at Baird & Co. Inc. had factored the use of this premium into the estimated mill rate. When it was not applied as intended, taxes went up much more than projected because the tax levy increased substantially. This was a result of miscommunication between the TRSD district office, TRSD board of education and our financial advisors at Baird and Co., Inc. We take responsibility and are deeply sorry for it.
In addition, our state aid decreased by $639,803 in 2022-23 when compared to the 2021-22 school year. This is because the state factored in the bond premium proceeds in calculating our state aid which resulted in a large reduction for the 2022-23 school year.
In 2021, the school tax levy was at $3,980,821 and was the lowest school tax levy since the 2010 school year when the tax levy was at $3,798,969. By not applying the bond proceeds and losing the state aid, the school tax levy increased to $5,733,189. This is what caused your large tax increase. Once the tax levy is certified on November 1, we can’t change it or make any corrections to it. We must wait until the following tax year.
How does the school district correct this tax problem? There will be a large reduction in the school portion of your tax bill in 2023. By law, as long as the referendum construction project is in progress, we are able to utilize our bond proceeds to offset the school portion of the tax levy. Our construction project will not be completed until 2024. Also, by law, we can only use the bond proceeds to offset the tax levy.
The bond proceeds will continue to draw interest over the next year and the district will utilize the bond proceeds plus interest earned to offset the tax levy next year. We are currently researching the best possible interest-earning option for the proceeds balance. Our state aid will also increase next year, and you will see a drastic decrease in your school portion property tax bill, offsetting the 2022 excess tax for district residents. When the bond premium and increase in state aid are applied to the tax levy in 2023, it will bring the tax levy back in line where it should be and what was calculated and advertised for the referendum dollar amount.
If you have questions about your particular property tax situation, we want to try to help you. Please contact the district at 715-824-5521 and bring your tax bill(s) to the district office and we will ask our representatives at Baird to help with answers.