Culver signs trio of education measures

DES MOINES – Gov. Chet Culver today signed three education-related measures that are designed to protect taxpayers and assist Iowa's 361 school districts.

The first bill, House File 2030, requires school districts to use their cash reserves before increasing local property taxes to cover budget shortfalls.

According to backers, the measure prevents school districts from shifting the burden to property taxpayers if the districts have surplus money in reserves not designated for other purposes. K-12 public school budgets are a mix of general state dollars and local property tax revenue.

“At the end of the day, the property taxpayers win because we've given some options to schools that they haven't had before,” said Sen. Brian Schoenjahn, D-Arlington, floor manager for H.F. 2030 in the Senate.

Culver also said he hoped school districts would follow the state's lead in looking for efficiencies in their operations to trim costs and save taxpayer dollars.

“The combination of efficiencies and using cash reserves should limit any additional property tax increases,” the governor said.

Culver also signed Senate Files 2045 and 2046, two companion bills that delay until next session the Legislature's decision on how much it will increase “allowable growth” state aid for school districts for the 2011-2012 school year.

Lawmakers decided to defer action for one year to better assess economic conditions and the state budget outlook.

Craig Lang, president of the Iowa Farm Bureau Federation, said that while H.F. 2030 may delay property tax increases in some school districts, it will not address the shortfall in state aid caused by Culver's 10 percent across-the-board cut ordered last fall. That $227.2 million reduction in state aid for the current fiscal year will result in higher property taxes, with some affects being felt immediately, he said.

Lang said preliminary data compiled by his organization for fiscal 2009 indicates that 133 school districts will not be able to cover the lost state aid funding. Those districts face possible property tax increase of up to $115 million, he said.

House File 2030 will allow an expanded four-member School Budget Review Committee to work with local schools in deciding when districts' unexpended balances are excessive and how much should be used before local boards turn to property taxpayers for funding. The bill indicates that local school cash reserves not exceed 20 percent of general fund expenditures by fiscal 2012.

According to preliminary data compiled by the nonpartisan Legislative Services Agency, the total undesignated and unreserved fund balance for K-12 school districts was $318.6 million in fiscal 2009.

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