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Levy window may be open Option provided by Legislature aired Staff Writer CROSBY - The Crosby-Ironton School District may have a window of opportunity to levy about $4 million in teacher retiree costs, part of the 2005 C-I teachers' strike settlement, freeing up about $400,000 a year for other operational costs.
C-I Superintendent Jamie Skjeveland told the board Monday in a special meeting that the state Legislature in May authorized school districts to now levy its Other Post Employment Benefits, or OPEB, onto a district's annual levy.
About 16 percent of the district's operations budget comes from local taxpayers each year, including seasonal recreational properties. This does not include monies from voter-approved operation levy referendums, which seasonal recreational properties don't have to pay.
Back in 2005, one of the main sticking points in settling the two-month-long teachers' strike was teacher retiree benefits. The two sides ended the strike after agreeing to start a Versatile Employee Benefit Alternative account, or VEBA, a tax-free health savings account for then-current teachers when they retire.
It also grandfathered in retired teachers. Under the plan, the district would contribute to a group plan for teachers who at the time of retirement were at least 55 and retired after 30 years of service, including 15 years of district service. The district was responsible for contributing $4,875,000 to the account from 2005 to 2019. From 2009 to 2019, the district has about $4 million left to pay into the VEBA account, said C-I business director Bill Tollefson.
The school board now has the authority to levy local taxpayers for its OPEB liability, which would eliminate VEBA as a district expenditure and free up funds for other areas of the budget.
For a $100,000 property, this would mean a tax increase of about $2 a month, or $24 a year, said Skjeveland. He said an OPEB liability is a bond levy, which means that seasonal, recreational property owners also would be taxed. The district would issue bonds for this new fund.
While the board did not approve this new levy at Monday's meeting, it did authorize the hiring of Van Iwaarden Associates for actuarial services to help the district plan the most viable and cost-effective amortization schedule for an OPEB liability levy. The district could issue this levy for up to 30 years to pay off its VEBA settlement.
"So, is this the first time as a board we can tax people without asking?," board member Mike Domin asked.
"This is brand new," said board member Scott Kile. "The word through the legislative grapevine is that they might redo this all over or tweak it during the next legislative session. We're looking at the possibility of 'use it or lose it,' it depends on the legislature."
In board action, the board set the truth in taxation hearing for 6:30 p.m. Dec. 2 and a continuation hearing, if needed, for Dec. 11.
The board also hired Bruce Larson as technology coordinator and approved an unpaid three-year extended leave for Elizabeth Lee.
JODIE TWEED may be reached at jodie.tweed@brainerddispatch.com or 855-5858.
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