Owensboro Public Schools voted Thursday night to impose a minimal tax increase by including tax exonerations from the previous fiscal year. Taxpayers living in the City will pay 86.6 cents on real property and personal taxes through this general fund tax levy.
The 86.6 cents is up .3 percent from 2019, officials say. In 2019, the general fund tax was levied at 86.3 cents on real and personal property, producing revenue totaling $11,935,202.56. The .3 tax increase will give OPS a revenue total of $12,711,182.55.
Of this amount, officials say, $1,373,118.41 is from new and personal property.
The Owensboro Independent Board of Education held a public hearing before Thursday night’s board meeting, giving members of the community a chance to speak to the board publicly in regard to the proposed tax increase. This hearing was to be held before a vote was taken, though no one from the public was present to speak against the proposed tax increase.
Finance Officer John David Sandefur said the tax rate is actually staying the same, though the tax increase will be raised due to exonerations that will be paid off.
“[The board] is keeping the same tax rate, but they’re taking the exoneration,” he said. “The state does a calculation of the exonerations, which allows us to collect the prior year’s taxes that were not paid.”
If a resident was exonerated from paying their property tax in 2019, for example, that resident was exempted from paying that revenue, Sandefur explained. That revenue is something OPS counts on each fiscal year.
“It’s basically an exoneration of the non-payments from the previous year,” he said of the process. “When the Kentucky Department of Education sends us our rates, there’s a footnote at the bottom that says, ‘You can take whatever for exonerations.’”
Sandefur said OPS has taken the exoneration almost every year since he’s been with the school district, calling the decision to claim exonerations a smart business move for the school district.
OPS will allocate $775,979.55 above the 2019 revenue toward $11,640 in collections costs, $380,280 in instruction costs, and $384,059.55 in maintenance and utilities costs.
“It’s a way for the state to give you the revenue you were counting on from the year before,” Sandefur said. “It’s really a minimal impact on the taxpayers.”
OPS isn’t the only district imposing tax increases as Daviess County Public Schools will vote on a tax increase in late August as well. The proposed increase is .7 cents per $100 of assessed value, plus .1 cent for exonerations. The rate DCPS is proposing will add an additional $1.9 million in revenue for the school district, which would be used to offset a loss in state revenue of $983,000.