BROOKSVILLE — It's time for the Hernando School Board to use what little power it has to raise the district's tax rate.
That's the message that superintendent Bryan Blavatt and chief financial officer Desiree Henegar say they will bring to the board as budget workshops begin in the coming weeks.
The revenue picture could be so bleak for next year, the board will likely have little choice but to increase the tax rate by 25 cents for every $1,000 of taxable property value to bolster the operating fund, Blavatt and Henegar said.
"I think we're pretty well compelled to," Blavatt said. "With the financial situation, we could be in trouble."
Board members — even some who wouldn't consider raising the rate last year — already acknowledge that they may add the quarter-mill levy for 2010 because the Legislature's failure to properly fund education is shifting the burden to school boards.
"They have a gun to our heads, and I don't think we have a whole lot of choice," board member Sandra Nicholson said.
School boards have little say in the school tax rate because the state sets most of the rate based on property values. Last year, however, the Legislature gave school districts the ability to levy an additional quarter-mill tax with a super-majority vote of board members.
Forty-two of 67 school districts in the state tapped the extra tax money, but Hernando chose not to. Beyond the obvious resistance to raising taxes in a recession, board members worried about the state withholding so-called compression funding from districts that levied the tax. The money is doled out to compensate districts in counties where property values are lower than the state average.
That is not a factor this year, Henegar said. The additional quarter mill would bring in an estimated $2.2 million, a sum that could put a significant dent in the gaping revenue hole left by the county's plummeting property values, she said.
The property appraiser's estimate released last week put the drop at more than 12 percent. To the school district, that could mean a loss of some $8 million, bringing property tax revenue down to a projected $51 million.
State education funding is set to increase slightly from the past year, but that's based in part on an assumption that more students will show up in Hernando next year.
"We're hurting," Henegar said. "The thing that concerns me is our costs are going up, and our revenue is not going up to match the costs."
The costs are largely out of the district's control, Henegar said. Health insurance and retirement plan expenses are expected to increase. While the district set aside $3.5 million for operating costs for the new Weeki Wachee High School opening in the fall, no money is carved out for the following year. And Hernando's nearly $15 million share of federal stimulus dollars runs out next year.
The district needs to continue to look for ways to operate more efficiently, but cutting alone is probably not going to be enough, board member James Yant said.
"I think we have to be open to it," he said of the quarter-mill levy. "I don't think we have a choice if we're going to maintain the system as we have it now."
Last July, as the board contemplated the additional levy, Yant and board member John Sweeney wanted to give tentative approval to the increase before millage rates were mailed to property owners.
The board by law can vote in September for a final millage that is lower but not higher than the tentative rate.
Nicholson and board chairman Pat Fagan voted against the levy. Board member Dianne Bonfield was absent from that meeting but said she would have voted no.
The board set the final tax rate at 7.47 mills, or $747 for a $150,000 home with a $50,000 homestead exemption. With the additional quarter mill, the tax bill for that home would have been $25 more.
On Thursday, Bonfield said she will base her decision on the numbers. The first budget workshop is June 15.
"I have to see in black and white where we are, where we're going and what this is going to do for us," she said. "I think we've done a heck of a job in providing more for less money, but there comes a time to keep services you have to make tough decision."
The option has to be on the table, Fagan said.
"I won't do anything that's going to hurt the district in regard to funding the kids," he said. "It's definitely going to be more pressing this year."
The local teachers union leader said he will try to make the same case he did last year: The extra quarter mill is a small price to pay to keep schools operating sufficiently, and board members — three of whom are up for re-election this year — are going to have to take the political brunt of the Legislature's actions.
"We need every dollar or we cut programs," said Joe Vitalo, president of the Hernando Classroom Teachers Association. "You don't take it, we have to cut positions."
Pasco's superintendent is recommending approval of the levy in that county. Pinellas already has built the quarter mill into its budget model for the board's consideration, while Hillsborough doesn't expect to use the option, according to officials from those districts.
When lawmakers finalized the education budget this year, they made the assumption that at least as many districts would levy the additional quarter mill this year as did last year.
That's a safe assumption, said Wayne Blanton, director of the Florida School Boards Association. Blanton said he expects even more districts to exercise the option this year.
"They basically have to," Blanton said. "It's either that or start laying off a substantial amount of people."
As school boards consider using their power to increase the tax rate, they must also think ahead to the following year.
If districts want the extra levy for the 2011-12 budget year, it must go to a voter referendum this fall. If the Hernando board wants to put the issue before voters, it must ask the county elections office by Aug. 24 to place the measure on November's ballot, Henegar said.
Few boards are expected to take that approach, Blanton said. Districts are handicapped because they cannot use public resources to mount a campaign to achieve the difficult task of convincing voters to tax themselves for schools, he said.
But some districts will be so desperate for funding, school boards will go for a referendum — and they will likely ask voters for an additional half mill or more, Blanton said.
"If you're going to put something on the ballot," he said, "why not something that's going to fix the problem instead of plug a hole?"
Tony Marrero can be reached at firstname.lastname@example.org or (352) 848-1431.