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When they go to the polls next Tuesday, Fayette County voters will be asked to approve a 1-percent sales tax that will benefit school districts in the county.
The Fayette County Board voted last December to put the sales tax issue onthe ballot, acting on a request made by superintendents of school districts in the county.
Through a state law approved by the legislature about three years ago, counties may increase the sales tax rate in .25 percentage increments up to 1 percentage point on items currently taxed at 6.25 percent. Any such increases must be proposed by a county board and then approved by voters.
“As it is now, the burden for schools is on property owners,” said Vandalia Superintendent Rich Well. “This is an option that allows school districts to abate property taxes – that’s the bottom line.”
In the Vandalia School District, monies generated through the new sales tax would be used to reduce the district’s bond indebtedness, which totals a little more than $1.418 million annually.
Well estimates that the sales tax would generate roughly $750,000 for the district annually. Applying that revenue from the tax would drop the indebtedness to a little less than $670,000.
Although there are several variables each year, including the Equalized Assessed Valuation figure and the amount of sales in the county, Well has estimated that the annual savings at $256 for a person owning a home valued at $100,000.
The savings estimated for a home valued at $150,000 is $385 and for a home valued at $200,000 is $513.
Well likes the idea that people traveling through Vandalia – those who buy gas here, eat at local restaurants or stay overnight in a local hotel – help generate funds that would be used to improve local schools.
In the St. Elmo School District school officials would use that district’s new funds for a building project.
But it still boils down to alleviating the burden on property owners, according to St. Elmo Superintendent Deb Philpot.
Philpot presented to the St. Elmo Board of Education plans for a new gym at St. Elmo Elementary School. The cost of that structure, a metal-sided building that would include locker rooms and a conference room, has been estimated at $1.5 million.
“We would only do this if the sales tax passes,” Philpot said.
Currently, the gym at the elementary school is also used as the school cafeteria.
“We are very restricted when we can use it for physical education classes, or for any other things,” Philpot said.
“This will allow us a great amount of flexibility with our P.E. classes,” she said, adding that the structure would also be available for community access.
Philpot estimates conservatively that the new sales tax would generate about $200,000 annually for the St. Elmo District.
That, she said, would be enough to pay off bonds that would be sold for the building project, and would leave some additional monies that could be used for other building improvements throughout the district.
“This is a more equitable tax,” Philpot said. “It is an opportunity for property tax relief – it shifts the revenue burden over to everyone, instead of just those who own property.
“Anytime that we need funds for a building (project), we have to go to (the sale of) bonds,” Philpot said. “This gives us an option on how to pay off those bonds.
She said that the additional monies would be more important in light of possible decreases in state funding in the future.
“We keep hearing that they (the state) is going to cut transportation funds (given to school districts),” she said. “If that does happen, we will have to be moving education fund dollars to our transportation fund.
“The juggling act is going to get tougher and tougher,” she said.