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Lisbon school district’s carryover budget likely to take a big hit

LISBON – The school district’s healthy carryover budget is likely to take a big hit mostly because of the state legislature’s decision to keep state education funding at  current levels for the next two years.

School Treasurer Vickie Browning-Prowitt reported at Thursday’s school board meeting the district ended the 2018-2019 school year with a $3.5 million balance, down $100,000 from the record set the year before. That balance is expected to decline to $2.8 million by the end of the current school year and then drop to $1.7 million by the end of the 2020-21 school year.

Browning-Prowitt’s five-year forecast, which school treasurer’s are required to produce every May and October, projects Lisbon will be $1.1 million in the red at the end of the 2022-2023 school year if state education funding remains frozen at current levels, with the deficit growing to $3.3 million the next year.

The school district received $5.9 million from the state last year, accounting for 62 percent of Lisbon’s total operating revenue. Real estate taxes, at $1.4 million, comes in a distant second, accounting for nearly 15 percent of the district’s revenue.

Browning-Prowitt expects their real estate taxes will take a hit as well because of the village’s recent decision to create a Community Reinvestment Area program that provides property tax breaks of up to 100 percent on all new residential construction and major improvements. She said the district receives about $200,000 in tax revenue annually from new construction/improvements and she said that could go away if everyone making improvements in the future applies for the tax exemption.

The district is in the second year of a three-year contract awarding pay raises of 3 percent, 2.5 percent and 2 percent, and Browning-Prowitt said that is costing the district $400,000 a year, but there is no new money to help cover the expense, further compounding the situation.

There is some good news on the horizon. A committee of the state legislature is working on a new school funding formula that most observers believe is  more equitable than any of the other formulas used in the past.

“There’s winners and losers, as there is in any plan, but the Cupp-Patterson plan is the best one that has been proposed in 30 years,” said school superintendent Joseph Siefke.

The legislature did provide school district’s with additional funding over the next two years, but it can only be spent on “wellness and success” program that provide social services to students struggling in school and at home. Most districts already provide some of these services, and the new money can be spent on those existing services, freeing up funds for the district to spend elsewhere.

Lisbon officials are still working on a comprehensive plan on how to spend the $524,422 in “wellness and success” program money it is to receive over the next two years.

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