Superintendent
News & Views
Update
on the SAVE Statewide One-Cent Sales Tax for School Infrastructure
By
David Hill, North Tama Superintendent
This past spring, Governor Kim Reynolds
signed a bill into law that will truly make a positive difference for Iowa’s
school districts, students, and property owners. House File 546, signed by the
Governor after receiving bipartisan support in the Iowa legislature, extends
the statewide one-cent sales tax for school infrastructure for an additional 20
years while providing additional property tax relief for property owners.
 |
| Gov. Kim Reynolds signed HF546, the SAVE extension, into law on May 24, 2019 at the Sioux City Career Academy. The law extends the penny sales tax for school infrastructure to January 1, 2051. |
Commonly called the “statewide
penny,” the official term is SAVE, which stands for Secure an Advanced Vision
for Education. Since SAVE became law in
2009, it has allowed Iowa’s school districts to maintain and upgrade their
facilities and to provide students with increased school security, safer
transportation systems, and better access to modern technology as well as the
necessary technology infrastructure without increasing the burden on property taxpayers.
Since the SAVE became law, the
North Tama County Community School District has used these revenues to improve
and maintain our facilities, build the 2010 addition (which included the Jr.
High wing, gym lobby, locker rooms, and administrative offices), improve
student safety by installing controlled-access systems and video security, air
condition our classrooms, improve handicapped accessibility, provide 1-to-1
computing devices and computer labs, improve technology infrastructure,
purchase buses and vehicles, install air conditioning and seat belts on route
buses, repair roofs, and to provide numerous other improvements to our academic,
athletic, and fine arts facilities. During the same time period that all of this
has been accomplished, the burden on North Tama’s property taxpayers has been
reduced. The current property tax rate
of $10.23 per thousand is one of the lowest property tax rates in our
region.
The current statewide penny had
been set to expire in 2029. The year 2029 may seem like a long way off, but
that time frame is short enough to impact school districts’ ability to issue
bonds against future revenues. Realizing
this, leaders in the Iowa Statehouse had been working to achieve bipartisan
support for extending SAVE for the last few legislative sessions. A compromise was finally reached this
year.
The new SAVE law isn’t identical
to the previous one. Among other
differences, the new SAVE commits additional funds for property tax
relief. Depending on the annual growth
in statewide sales tax revenues, the amount dedicated to property tax relief
will increase each year by up to 1% until it reaches a cap of 30.0% of the
funds generated. Another change in the
law requires a public hearing before SAVE revenues are spent on athletic
facilities that are not attached to a school building.
Consumers won’t notice a change
at all -- sales taxes paid on purchases throughout Iowa will remain the
same. Funds generated by the SAVE go
into a statewide pool that is distributed to districts based on certified
enrollment...this makes the distribution of funds more equitable for school
districts, regardless of whether it is an urban district with a lot of retail
business or a more rural district with fewer retail transactions.
In the coming years, SAVE
revenues will continue to be vital for North Tama to maintain our buildings and
boilers, to continue upgrades to facilities, technology infrastructure, student
technology, and transportation equipment. In addition, our facilities need continued
accessibility improvements for handicapped individuals.
The price tag for the
improvements mentioned in the preceding paragraph is likely to be high.
Accomplishing these items within a reasonable timeframe may require bonding for
a period of more than ten years. The
extension of SAVE makes that possible.
Before North Tama was able to
borrow funds for the 2010 addition project, it was necessary for voters to approve
a Revenue Purpose Statement (RPS) that gave the district the greatest amount of
flexibility allowed by law when using SAVE revenues. That RPS ballot measure received overwhelming
voter approval. Voters at that time realized that a “Yes” vote didn’t cost them
anything and gave their school district the flexibility to use SAVE funds to
meet the needs that had been prioritized locally. Those “Yes” votes made a
major addition and renovation project at North Tama a reality without raising
anyone’s taxes.
Now that SAVE has been extended by
the legislature, school districts must pass another Revenue Purpose Statement
ballot measure before bonding against future revenues beyond the original SAVE
sunset date. At the September school
board meeting, the North Tama board will be considering whether to have a
Revenue Purpose Statement measure included as part of the November election
ballot.
Whether it is on our local ballot
this November or not, I’m sure voters across the state will be voting on
Revenue Purpose Statements over the next few years as the sunset of the
original SAVE approaches. It is my guess that voters across Iowa will once
again vote in support of these measures, as it really is a “no-brainer.” Consumers statewide will pay the sales tax
either way, and school districts statewide will receive the revenues either way
-- the RPS just gives districts a little more flexibility with the dollars they
are already receiving.
If you’d like to hear the school
board’s discussion as they consider this topic, consider attending the
September school board meeting on Monday, September 16 at 7:00 p.m. in the North
Tama ICN Room. I will keep you posted on
the board’s decision in this column. If
the RPS is on the ballot, I will use this column to provide detailed
information and to answer any questions submitted by district patrons.
As I close this column, just a
reminder to all district patrons that there will be four school board seats up
for election this November, and that nomination forms for school board
candidates are now being accepted in the district office. Forms can be picked up during business hours
from board secretary Terrill Karr, and completed forms with the appropriate
number of signatures must be returned to our office no later than September 19
at 5:00 p.m.
I encourage your feedback
on this column, along with any questions you may have. You are welcome to visit
my blog at http://redhawksupt.blogspot.com where you can read all of my
columns and leave comments if you wish. You are also welcome to follow me on
Twitter, where my handle is @DavidRobertHill.
