School taxes will decrease
Published 9:50 am Friday, May 18, 2018
School taxes will decrease
By Jeremy Weldon
Panola County taxpayers will fund the building of a new football fieldhouse and an indoor training facility rivaling those at Division 1 colleges, and make a few other school district property upgrades with the proceeds from the sale of $3 million in tax notes.
Servicing the debt created by the sale will cost taxpayers about three mills in addition to the 57.5 mills assessed each year for general operations of the district’s schools, including salaries and benefits.
David Rubenstein, director of the district’s finance office, explored the possibility of having local banks bid for the tax notes, but banking industry regulations and term length wouldn’t allow for that option.
Instead, Rubenstein expects quotes for the sale of the tax notes to come from Wall Street-based financial institutions, probably from a firm that specializes in school and municipal bonds and notes.
Rubenstein said that daily fluctuations in the stock and bond markets will no doubt have a bearing on the rates the financial institutions are expected to bid. He thinks the district can expect to pay about 3.5 percent interest on the notes.
But, because the district has recently retired a large debt assumed when the high school was built, the total millage rate for the operation of schools and debt servicing will drop by a little more than four mills in the coming fiscal year.
In short, taxpayers will next year begin paying less taxes for schools even as the district takes on the ambitious addition to the high school’s athletic department.
Not to be overlooked is a donation of $500,000 from the South Panola Athletic Foundation to the project. Long-time Tiger football benefactor Robert Dunlap gave the half-million gift for the new fieldhouse and indoor that will adjoin the football field that already bears his name.
Dunlap’s generosity not only is a testament of his support for the Tigers, but will save taxpayers a considerable sum over the life of what is essentially a construction loan for the project.
State law caps school districts at 57.5 mills for operating costs each year, and any additional funds must come from bond issues, the sale of tax notes, or other forms of borrowing money.
Panola County residents have been paying 64.65 mills for schools on the assessed value of their property the past several years. That figure will drop to 61.65 a year when the sale of the current tax notes is finalized.
Budgets for cities, counties, and schools are funded year to year by assessment of mills to each property in a given area. Each mill essentially adds $1 of tax for each $1,000 of assessed property value.
In the 2017-18 fiscal year, the value of one mill to the school district was about $170,000.
The total assessed valuation for schools paid by property owners during the period was $186,516,084.