Bartlett Schools: Referenda and Beyond, Part 2

By William J. Busler, Ph.D.

Last week, we covered the history of the school merger, and the implications of the August 2nd referendum on forming a Municipal School District (MSD) in Bartlett. We saw that as of August 2013, Bartlett schools will either be administered by the Unified Shelby County School District, comprised of 272 schools and 159,000 students, or, if the referendum passes, a Bartlett MSD, with 11 schools and 9,000 students. The present structure – a suburban Board with 52 schools and 56,000 students – is no longer an option.

FINANCING THE BARTLETT MSD

A frequently-raised question is “What is this going to cost?” The exact answer, at this point, cannot be determined. Anyone who tells you otherwise is misinformed or is not being honest. However, some facts are known.

The consulting firm hired by Bartlett (and the other suburban municipalities), Southern Educational Strategies (SES), estimates that it will cost $68.3 million per year to operate the Bartlett MSD, at the present level of services. Fortunately, that money does not have to be raised anew each year by the citizens of Bartlett. We are already paying that amount through local, state, and federal taxes.

For each student being educated in the public schools within Shelby County, the County government contributes about $2,000 from its own tax revenues. In addition, state and federal funds totaling about $6,000 per student are given to the County for education, and are passed on to the students. In other words, the County allocates about $8,000 from various sources for each student in Memphis City Schools or Shelby County Schools. (MCS students receive about $2,000 in additional funding from grants, etc.)

Very important: Existing laws call for this funding to “follow” the students. Thus, $8,000 per student will continue to go to any public school systems within Shelby County, including the new Unified SCS system and any newly-created MSD’s, based on their “Average Daily Attendance” (ADA).

The consultants’ report assumes that the school buildings would be transferred to Bartlett without cost, and that contracts for support services such as for maintenance, transportation and nutrition could be negotiated at the present rate.

A quick calculation shows that $8,000 for 9,000 students would generate $72 million. (SES projects $69 million.) Why, then, would we need to raise any more money at all? Actually, state law requires that each community forming a school district demonstrate its commitment by investing an amount equivalent to 15 cents of its property tax rate to be used for its schools. If Bartlett actually raised its tax rate by 15 cents, the yearly taxes on a $200,000 home would increase by $75, generating about $1.65 million per year. Note, however, that the law does not require the tax rate to be raised by 15 cents, only that that amount be earmarked (and spent) for education.

An alternative proposal, set forth in the second referendum, is to increase the “local option” part of the sales tax by 0.50% within Bartlett, from 2.25% to 2.75%. This would actually bring in more revenue ($3.625 million) than the property tax increase. Not all of this money needs to be given specifically to the schools; at the discretion of the Board of Mayor and Aldermen, some can go into the general fund. If the sales tax revenue were absolutely earmarked for the schools, this would create a “maintenance of effort” benchmark that could never be reduced later on, even if we didn’t need it all. If this second referendum passes, the cost of a $100 cart of groceries would increase by 50 cents.

If we do approve the MSD referendum but the sales tax referendum fails, then property taxes might have to be raised, or cuts made elsewhere.

Next: Implications, Obstacles, and Questions

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