Why is Oregon-Davis low on funds?
First off, you have to understand that school funds work much different from your home budget. Every grant or allocation they get goes into a specific category. The funds in a category can ONLY be used for that category. It would be like you separating your bill money at home, only if you ran short on rent, you are not allowed to take money from the credit card fund. Oregon-Davis is low on the general fund, which serves to pay bills, salaries, supplies etc.
The school used to be funded in part by a tax levy. Mitch Daniels and the General Assembly discontinued that funding in 2008, telling schools that they needed to pass referendums instead. Then, the Governor managed to lose some $320, 000, 000 that was supposed to go to schools. Eventually, yes they did find it, but that money still won't go to Indiana schools. Next, the General Assembly changed the school funding formula. Another 10% was cut from Oregon-Davis schools. That cut went into effect in January of 2012.
As you can see, there has been a lot of taking of funds from the state. If there is poor money management as all the signs would try to convince you, it's not by OD, but by the state. (Please tell me how you lose over 300 million dollars?!)
What has Oregon-Davis done to correct their budget?
Now, if you or I lose a financial resource, we have to try to adjust our budget. Oregon-Davis is no different.
They have eliminated the school pension debt. They have dropped transportation costs. They refinanced the mortgage and reduced the interest from 5% to 2.3%. They are the leader in the area when it comes to New Tech, which saves on supplies for students, teachers, and administrative staff. They eliminated 5 positions. A salary freeze is in place, though the staff is still required to meet their continuing education requirements.
What are the financial implications?
I'm not going to throw around a lot of terms and dance around the issue. I imagine that most people heard the term "19%" and started seeing their bank accounts drain. Let's be clear here. That is 19% on every $100 worth of property assessed. That's not 19% on every dollar. If you own $100 worth of property, your tax rate goes up $.19, not $19.00. There's a big difference.
But even that is not completely accurate. Due to some of the refinancing that the school has done, you're actually going to be looking at an extra $.07 on every $100 worth of property. Because of standard deductions, if you have $200,000 worth of property, your net tax rate will increase by $68.43.
What happens if the referendum doesn't pass?
If the referendum passes, Oregon-Davis will continue as they are. But let's assume the worst case scenario. If the referendum doesn't pass, students may find themselves attending schools in a different corporation. With the change in attendance also comes the change in where your taxes go.
The state average rate of property taxes that go to schools is $1.18. Oregon-Davis is $.9207 and with referendum, will increase to $.9907. Knox is at $1.1132 and North Judson-San Pierre is at $1.1103.
So, even with the referendum, Oregon-Davis still has the lowest rate in the county. If you vote no, and Oregon-Davis is no more, you'll actually end up paying more than you would have with the referendum.
Basically, this is a no-brainer. Vote for the referendum and you'll still have the lowest tax rate in the county. Vote against the referendum and you'll have to explain to your kids why you would rather pay more money to send them to a school outside of their community.