A steep increase in the Brainerd School District's 2019 tax levy should come as no surprise to residents after this spring's bonding referendum. But the exact increase is now set in stone.
The district's levy will increase by 19.42 percent from 2018, a change of $3.79 million. This amount-a total of $23,330,304.26-is a slight decrease from September's preliminary levy, which the board set at a 19.86 percent increase-the maximum amount allowed by state statute.
The school tax levy is based on calculations completed by the Minnesota Department of Education, which administers the funding formulas governed by state statutes. The state formula for revenue is based on pupil units, a weighted enrollment measure.
The 2019 levy takes into account a projected 2019-20 enrollment of 6,538 students and is made up primarily of the district's general fund (44 percent) and general debt services (43 percent). In contrast, the 2018 levy was 52 percent general fund and nearly 32 percent debt services. Marci Lord, director of business services, said in September the referendum is the reason for the higher debt services portion.
When asked about the tax impact of the levy during the school board's public hearing on the levy Monday, Dec. 10, Lord said she did not have the specific numbers but expects the property owners' annual tax increase to be in the realm of what was presented to voters before the April referendum. Property owners with a home valued at $152,600 were projected to see an annual increase of $7.28 if the referendum passed. When the board passed its preliminary tax levy in September-a 19.86 percent increase-Lord estimated the tax increase at $7.27.
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A majority of the 19.42 percent increase, Lord said, is due to the referendum, as other local levies did not change much.
The $205 million bonding referendum garnered voter approval April 10 to invest in improvements to school facilities, build a new elementary school in Baxter and a 1,200-seat performing arts center at Brainerd High School.
A new agriculture bond credit will provide the district with $103,671 of tax relief in the upcoming year. Lord said the credit, introduced in 2018, replaces a portion of locally collected taxes paid by farm and timberland owners with payments from the state general fund, which is composed of income and sales tax collections.
Public input
Only one resident spoke during the public hearing after Lord's presentation.
Dennis Drummond, resident and owner of Dennis Drummond Wine Co. in Brainerd, said he can handle the property tax increase for his home but is concerned with the roughly $800 increase to the taxes for his business.
"We're a new business," he said, "and so we're watching every penny."
Drummond acknowledged the high quality of Minnesota schools, citing them as the reason he moved here from California, and said he voted for the district's referendum but just wanted to share his concerns with the board.
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"I believe in what you guys are doing," he said. "Yes, I know you've got to extract money out of something, but it hurts, and I just wanted to say that."
