Waiver of Prop C sales-tax rollback approved by 65% of Lindbergh voters

Lindbergh’s financial situation still looms, Lanane tells Call

By MIKE ANTHONY

Lindbergh Schools voters last week overwhelmingly approved Proposition L, a waiver of the state’s Proposition C sales-tax roll-back.

Proposition L received 6,666 “yes” votes — 65.75 percent — and 3,472 “no” votes — 34.25 percent — according to unofficial election results from the county Board of Election Commissioners.

“First of all, we want to thank all the voters,” Chief Financial Officer Pat Lanane told the Call. “I mean, golly, that’s an overwhelming show of support and I kind of interpret it as confidence, too, in the school district. That was a complicated issue and to some extent, people had to believe what we were telling them.

“And that’s really what I was most impressed by that there’s still that confidence and that feeling of trust between the voters and the district. I’m not seeing that everywhere else right now,” Lanane continued. “… That overwhelming support for what was a pretty complicated issue really drove that home to me and confirmed that we still have that real basic level of trust be-tween all the voters in the district and the district itself.”

With the passage of Proposition L, Lindbergh joins 431 school districts in the state and 18 of 23 districts in St. Louis County whose voters have approved a waiver of the Proposition C sales-tax rollback.

Proposition C is a 1-cent statewide sales tax dedicated to education funding. Half of the revenue collected is divided among the state’s public school districts and the other half is returned to taxpayers in the form of a property-tax rollback unless district voters have approved a waiver of that rollback.

However, because Lindbergh’s current operational tax rate is the state-required minimum of $2.75 per $100 of assessed valuation, voter approval of the Proposition C rollback waiver will not have any financial impact, according to Lanane.

But if the Board of Education decides to seek a tax-rate increase at some point in the future, the rollback waiver would come into play. Without the waiver, Lindbergh officials would have had to seek a tax-rate increase greater than what is needed.

Without the waiver, Lindbergh would be required to roll back 14.8 cents if its tax rate was greater than $2.75.

Cognizant of the financial difficulty residents and businesses are experiencing as a result of the current recession, district officials pledged last November not to seek a tax-rate increase for at least 24 months.

Though Lindbergh also faces financial challenges as a result of the current economic recession, the district’s reserves of roughly $24.6 million are the reason why the situation is not a crisis at this point.

Voter approval of Proposition L is just one bit of good news district officials have recently received, Lanane said. He also noted that Lindbergh Schools was “Accredited with Distinction” by the Department of Elementary and Secondary Education for the ninth consecutive year and cited the Lindbergh National Education Association’s endorsement a new three-year agreement with the administration and Board of Education.

But the district’s troubling financial situation still looms, Lanane noted.

“… We’ve had these nice, positive things happen to us, but we still have one more really large problem to tackle and that would be the revenue loss for this year … Prop L, while it helps us in the future hang on to state sales-tax money, it really doesn’t do anything for our revenues right now,” he said. “So while that’s great, we still have a huge budget problem and I think people will look at us in that whole scenario I talked about in terms of trust and that will dictate that we hit this problem head-on.

“And the only way I know how to do that is to do some real belt-tightening.”

The district’s long-range financial plan calls for a planned spend down of those reserves with a deficit-spending cap of $3 million per year.

In June, the Board of Education adopted a 2009-2010 operating budget that projected a deficit of $3 million.

But a further decline in the assessed value of commercial real estate — including successful appeals by commercial property owners to the county Board of Equalization — increased the district’s projected budget deficit for the current school year to more than $5 million.

Lindbergh officials plan to further utilize district reserves this year to cover the increased deficit, but will have to cut an additional $2.5 million from the 2010-2011 budget.

“And there’s so little we can do at this point. I mean you can turn a thermostat down a degree. You can do all these little things and we are trying to do all those things, but you can’t get at those kinds of numbers by simply making small, operational adjustments,” Lanane said.

The CFO noted “substantial reductions” have been made over the past two years.

“… We reduced supply budgets right off the top. There was a 10-percent reduction in supply budgets. So we didn’t add those back in for this year. So those reductions from previous years have stayed in place and now we’re looking for what I say are reductions upon reductions,” he said. “But that’s as it should be. I don’t want anyone to interpret this as we’re crying about that.

“We don’t like making these, but everyone that I know is in the same situation. It’s no different than the family at home,” he said. “Everyone is making some sacrifices and cutting back, and that’s what we’re going to have to do.

“It will be painful, but we think we’ll come through this. Again, it’s the prudence of previous boards to have a rainy-day fund. That’s really saving us right now. But we have to get back to that original plan of using only a limited amount of that rainy-day fund. We’ve exceeded that now and we have to get back to the plan … We’re committed to maintaining this budget discipline because to do otherwise really jeopardizes these students’ future. You can’t spend the rainy-day fund, all these reserves, in one year. You can’t do that …”