News that Leland Public School will benefit from federal impact aid, an entitlement recently secured by the Glen Lake district, was delivered to the school board this week.
Superintendent Mike Hartigan told board members and the audience attending Monday’s monthly meeting that Leland has qualified for state impact aid through the U.S. Department of Education.
The amount and timing of the payment is not known, but news that the district could receive any additional income was welcomed. Glen Lake is expected to receive $1.7 million.
The Department of Education provides awards to school district that have lost property tax revenue as a result of military installations, Indian reservations, and other federal properties. To qualify, districts have to document that the assessed valuation of the (federal) property represents 10 percent or more of the total property in the district at the time (or times) of federal acquisition.
“We qualified by the skin of our teeth at 10.3 percent,” Hartigan said. “North Manitou was key … We’d be out-of-formula if that property was part of our tax base.”
With the help of the county Treasurer and Equalization departments and Leland Township assessor Julie Krombeen, staff members were able to demonstrate the lost tax base.
Though there are still “unknowns” with which to contend, board members agreed to reduce the amount of bonds to be sold to cover costs that do not lie within the uses allowed through the district sinking fund.
Earlier this month, district voters approved a 5-year, .25-mill levy to pay for $600,000 in bonds. As a result of the news about the impact aid, the district plans to sell only $200,000 in bonds this summer to finance the purchase of a new bus, science equipment and technological upgrades. The bonds will be repaid over three years, rather than five as first expected.
The millage levy for to repay the bond sale over three years will be .16 mills, business manager Sandra Potts said.
The millages collected by the district this summer will drop from those projected by Potts due to increases in the taxable property value in the district. The millage to repay the 2001 construction bond will drop from 1.65 mills to 1.47. That decrease, plus the .30 mills for the district’s sinking fund, will change the millage rate from an anticipated 2.02 mills to 1.93 mills.
More “good news” came to the district Monday in the form of a reduction in the anticipated increase in health insurance coverage through Michigan Education Special Services Association (MESSA).
Frank Musto and Rick Ringstrom of MESSA attended the meeting and explained how the group has responded to a new state law that required they provide school districts with claims history needed to secure competitive bids for health insurance. MESSA was sharply criticized for its initial interpretation of the state law and what school districts saw as a failure to comply with the measure, which local school administrators hoped could result in significant savings.
Health insurance costs for Leland, Suttons Bay and Northport — the three county districts that are insured through MESSA — was $1.86 million for the 2006-2007 school year.
Hartigan was initially told that his district would see an 8.79 increase in health insurance costs in 2008-09, but was informed in writing Monday night that the increase will instead be 4.18 percent. Suttons Bay, which was also bracing for a significant increase, will realize an increase of 3.29 percent. Three members of the Suttons Bay Board of Education were in attendance at the monthly meeting, interested in what the MESSA representatives had to say.
“This is great. I was concerned because based on our projections our fund equity ( at the end of the 2008-09 school year) would go below the 6 percent our board feels comfortable with,” Hartigan said.