Columbia Public Schools should ask voters to waive a property tax rollback to boost revenue and maintain healthy reserves, a financial adviser recommended yesterday.

The additional funds are necessary for the district to overcome obstacles created by the state’s new funding formula, Allan Crader, vice president of LJ Hart & Co., told the Columbia Board of Education at its annual retreat.

He also cautioned the board about the district’s dwindling reserve fund, which is expected to drop below 10 percent within two years.

Columbia’s reserves should not fall below 15 percent of the operating budget, he said.

Rather than ask for a levy increase, Crader advised asking for a waiver of Proposition C, which in Columbia amounts to a rollback of about 35 cents per $100 assessed valuation.

Proposition C is a statewide 1-cent sales tax used for education. Half of the money goes into a pool and is divvied up among the state’s 524 school districts. The other half of the sales tax revenue is returned to taxpayers in the form of a property tax reduction.

If voters were to forgo that rollback, it would amount to a roughly 35-cent property tax increase and generate an additional $14 million for Columbia Public Schools.

That’s a better option than increasing the levy because the waiver of the Proposition C rollback does not fluctuate with reassessment, Crader said. It’s also a common practice, Crader said, noting that about 175 other districts in Missouri have a waiver of the Proposition C rollback.

The board won’t take action on putting a Proposition C proposal before voters any time soon, Vice President Darin Preis said.

"That was the first time we’ve talked about it in public," he said after the meeting. Superintendent Phyllis "Chase mentioned the concept to me before, so I know she’s thinking about it."

But Preis said he’ll need more information before moving forward. He’s also curious to know why Columbia voters rejected similar waiver proposals in 1996 and 1998.

"In general, though, I like the idea," Preis said. "And I like the fact that 175 other districts have done it already."

Advertisement