Keeping options open

The Medford School District certified two versions of its budget and tax levy on Monday night.

With voters set to decide a $22.6 million referendum question on November 5, board members approved options for if the referendum passed and if it did not.

The totals are close to what was projected at the annual meeting held in August with changes due to enrollment count from the third Friday in September and the finalization of the state aid amounts.

The budget based on the referendum passing calls for a school tax levy of $8,561,887 and a tax rate of $5.99 per $1,000 of equalized value. School finance director Audra Brooks noted that the actual tax bills could vary because they are based on assessed values within each municipality. Under this levy, the owner of a $150,000 home would pay $898.50 in school taxes compared to $880.50 last year.

The overall levy increase based on the referendum passing would be 6.46% with the tax rate increasing 2.1% Brooks noted that the budget calls for a slight decrease in the Fund 80 community service fund portion and the utilization of reserves in that area to keep the projected tax impact to the $5.99 per $1,000 amount. Brooks explained this was done to soften the impact of the referendum with the rate expected to be lower in future years as state aid

See SCHOOL on page 5 payments increase to cover the state portion of the debt service. Medford currently qualified for 71% state funding. Under the current funding formulas the only reason this would change is if there was a substantial increase in tax base due to growth.

If the referendum does not pass the levy will be $7,990,262 which would be a .64% decrease from last year’s tax levy. The tax rate under this scenario would be $5.59 per $1,000 of equalized value a 4.72% decrease from last year’s tax rate of $5.87 per $1,000 of equalized value. In this option, the school portion of property taxes on a $150,000 home would be $838.50.

Based on a home valued at $150,000 (which is the median home value in the 54451 zip code) the referendum passing would result in a homeowner paying about $60 more compared to if the referendum did not pass.

The district currently has no referendum debt service, but is till paying down on money borrowed a few years ago to complete some needed projects through fund 38, which is paid out of the general fund. That debt has a 1.1% interest rate so there is no incentive in paying it down faster than scheduled.

The interest rate on any bonding for the referendum would have a significant impact on the taxes needed to pay off the debt. The district’s financial consultants at Baird have a conservative estimate for interest rate based on a worse case scenario that is a full percentage above what similar bond issues have been in the past six months. In addition, the Federal Reserve took action earlier this fall to lower interest rates and market analysts are forecasting an additional decrease later this year.

The Medford school district’s tax rates are well below the regional and state average. School tax rates averaged $7.18 per $1,000 of equalized value in 2023.

In a historical comparison, when the school levy limits were implemented in 1993, the Medford school district levy was about $4.67 million and the tax rate was $16.03 per $1,000 of equalized value. In the same year the state average was $17.91 per $1,000 of equalized value. In the more than three decades since then, the local school levy has increased by 72%, but the tax rate has dropped by 65%.

Board members voted to formally adopt the budgets and set the tax rates for both options. The state requires the school district budgets and tax rates to be set by the end of October.

In other business, board members:

• Received an AODA update from pupil services director Joseph Greget about historical and ongoing efforts to combat drug and alcohol use among students in the district.

• Discussed options for applying for a FEMA grant. The grant rules and funds have not been released for the upcoming grant cycle and district administrator Laura Lundy advised holding off on making a decision to either reapply using the same grant request as in the past, or rewrite it until the criteria information is known. The district has unsuccessfully applied in the past for FEMA funds to construct a storm resistant shelter space that could be also be used for other district space needs.

• Approved rewnewing the dental insurance with Delta Dental with a 6% increase in premiums.