Tax error leaves schools in tight situation

Tax error leaves schools in tight situation

Tim Leeds

The school districts still awaiting the payment of part of their revenue are hoping new tax bills bring in some money quickly.

"For us, now, if we don't see the second half of the money coming in until May, we're going to run into a cash-flow problem," North Star Superintendent Ken Halverson said this morning.

The Hill County commissioners said Monday an error in entering tax data had occurred in the Hill County Treasurer's Office last fall, leaving off a significant amount of money that normally goes to the schools.

Hill County Treasurer Sandy Brown, who defeated incumbent Carrie Dickson in the Democratic primary and took office in January, said her office's staff members are stuffing new tax statements for the additional amounts in envelopes, and those will be mailed off as soon as possible.

"Someone was entering data and did not enter it correctly," she said. "We just have to move forward and correct it."

Dickson could not be reached for comment this morning.

Halverson said the amounts in question are what is called above-base funding — the state Office of Public Instruction calculates the funding due in each district, and part of that amount is included in the local property taxes.

It is not amounts passed for new levies in the district — North Star did not put tax increases on the ballot last year, but took a significant hit in the loss of above-base funding.

North Star High School in Rudyard is scheduled to receive more than $256,980 in above-base funding this year, and the elementary school to receive more than $142,412.

Halverson said the district usually receives about 60 percent of its funding in its first payment in November — this year its first payment, which was delayed, had about 30 percent.

The Havre districts were hit even harder. The high school is scheduled to receive nearly $971,00 in above-base funding, with the elementary district set for more than $1,416,000.

District Clerk Zella Witter said the Havre districts usually receive 50 percent to 60 percent of their money in the first payment — this year they received about 20 percent.

"The only thing I'm concerned about is we get it straightened out right away," she said.

Gildford Colony Elementary School also lost its above-base payment, $10,658.31 for this year.

The Box Elder and Rocky Boy elementary and high school districts, as well as the Cottonwood and Davey elementary districts, generally do not receive above-base payments and were not affected by the error.

Halverson said the issue has increased the complications in an already-complicated funding process, involving statements and requests that must be filed with OPI throughout the year.

"(School) districts don't just get handed money by the state or county," he added.

He said his district has found they have options of transferring money from some accounts to the general fund if necessary, but that also involves complex procedures and will create other funding problems for those accounts.

The shortage already is hurting the district — some of the above-base money normally is used to generate more revenue through short-term investments, which is part of the process that allowed North Star to avoid a vote on a levy increase last year.

"You make money on what money you have as long as you can," Halverson said.

The major question is how fast the money will come back when the new statements go out. Halverson said that could be a major issue for North Star, where many of its taxpayers are farmers who tend to make their tax payments when they sell their crops — their payments are related to cash flow.

He said the money could come back in quickly.

"It could, in a perfect world, if everybody jumped for joy and ran into the courthouse to pay their taxes," Halverson said. "We all know that isn't going to happen."

The problem was initially discovered in December, when the payments coming in were less than they should have been, he said. After several weeks of discussions between the representatives of the districts and the county pinpointed the problem, they moved forward with finding a solution, Halverson said.

"The bottom line is, the county commissioners took responsibility, as they should have, and now we're trying to fix it," he said.

The school districts still awaiting the payment of part of their revenue are hoping new tax bills bring in some money quickly.

"For us, now, if we don't see the second half of the money coming in until May, we're going to run into a cash-flow problem," North Star Superintendent Ken Halverson said this morning.

The Hill County commissioners said Monday an error in entering tax data had occurred in the Hill County Treasurer's Office last fall, leaving off a significant amount of money that normally goes to the schools.

Hill County Treasurer Sandy Brown, who defeated incumbent Carrie Dickson in the Democratic primary and took office in January, said her office's staff members are stuffing new tax statements for the additional amounts in envelopes, and those will be mailed off as soon as possible.

"Someone was entering data and did not enter it correctly," she said. "We just have to move forward and correct it."

Dickson could not be reached for comment this morning.

Halverson said the amounts in question are what is called above-base funding — the state Office of Public Instruction calculates the funding due in each district, and part of that amount is included in the local property taxes.

It is not amounts passed for new levies in the district — North Star did not put tax increases on the ballot last year, but took a significant hit in the loss of above-base funding.

North Star High School in Rudyard is scheduled to receive more than $256,980 in above-base funding this year, and the elementary school to receive more than $142,412.

Halverson said the district usually receives about 60 percent of its funding in its first payment in November — this year its first payment, which was delayed, had about 30 percent.

The Havre districts were hit even harder. The high school is scheduled to receive nearly $971,00 in above-base funding, with the elementary district set for more than $1,416,000.

District Clerk Zella Witter said the Havre districts usually receive 50 percent to 60 percent of their money in the first payment — this year they received about 20 percent.

"The only thing I'm concerned about is we get it straightened out right away," she said.

Gildford Colony Elementary School also lost its above-base payment, $10,658.31 for this year.

The Box Elder and Rocky Boy elementary and high school districts, as well as the Cottonwood and Davey elementary districts, generally do not receive above-base payments and were not affected by the error.

Halverson said the issue has increased the complications in an already-complicated funding process, involving statements and requests that must be filed with OPI throughout the year.

"(School) districts don't just get handed money by the state or county," he added.

He said his district has found they have options of transferring money from some accounts to the general fund if necessary, but that also involves complex procedures and will create other funding problems for those accounts.

The shortage already is hurting the district — some of the above-base money normally is used to generate more revenue through short-term investments, which is part of the process that allowed North Star to avoid a vote on a levy increase last year.

"You make money on what money you have as long as you can," Halverson said.

The major question is how fast the money will come back when the new statements go out. Halverson said that could be a major issue for North Star, where many of its taxpayers are farmers who tend to make their tax payments when they sell their crops — their payments are related to cash flow.

He said the money could come back in quickly.

"It could, in a perfect world, if everybody jumped for joy and ran into the courthouse to pay their taxes," Halverson said. "We all know that isn't going to happen."

The problem was initially discovered in December, when the payments coming in were less than they should have been, he said. After several weeks of discussions between the representatives of the districts and the county pinpointed the problem, they moved forward with finding a solution, Halverson said.

"The bottom line is, the county commissioners took responsibility, as they should have, and now we're trying to fix it," he said.