Tax rate increase far below estimate

When Hamilton School District voters went to the polls in February, they expected to be voting themselves a 98 cent increase in their tax rate to pay for a new intermediate school and Hamilton High School renovation and expansion projects. Instead, the tax rate will increase only 37 cents.Tax-rate-board-web420

The good news for taxpayers came Oct. 15 as Hamilton School Board members approved a $57.4 million budget that includes a mil rate of $8.92 – instead of $9.55 that was predicted at the July Annual Meeting.

The owner of a $300,000 home will pay $2,676 in school taxes – an increase of $111 over last year’s taxes, but less than the approximately $300 increase that was projected.

The lower-than-expected mil rate is attributable to community growth and higher property values that spread school costs over more and higher-valued properties and increased state aid. During the referendum, school officials conservatively estimated that property value would increase by 2 percent. The district’s equalized valuation actually increased by 4.67 percent in the past year.

“During the referendum, we wanted to be sure that the tax impact would be no greater than what we projected, which is why we used conservative estimates,” said Hamilton Superintendent Paul Mielke, Ph.D.

“Property values and the growth within our communities were far greater than our projections and additional state aid further helped to minimize the tax impact on residents,” he said.

When the intermediate school opens in the 2019-20 school year, additional operational costs will be on tax bills. The operational costs were expected to increase the tax rate by an additional 39 cents per $1,000 of property value, but if property valuation exceeds projections as it did this year, that amount will be less as well.

The 2018-19 budget is up 3.92 percent increase over the current budget. The increase reflects expenses due to increased cost-of-living as determined by the state.

The new net tax levy — the portion of the budget paid by local taxpayers — increased to $31.5 million from $28.8 million in 2017-18. Debt service increased from $668,450 in 2017-18 to $4.2 million in 2018-19.

Each October, the School Board must adopt the budget, certify the tax levy and establish the tax rate after the Department of Revenue determines property values in the district. Tax bills are sent to property owners in December.