New Tax to Pay for Charter Schools? (UT)

October 4, 2010

State education leaders voted Friday to send lawmakers a proposal to reduce funding disparities among school districts, partly by implementing a new statewide property tax to help pay for charter schools.

The state Board of Education plans to present the four-part proposal to lawmakers later this month. The proposal aims to help shrink funding gaps between school districts in property-poor areas and more affluent ones. It’s a problem lawmakers have attempted to solve for years without much success, often because proposed solutions involved enriching property-poor districts at the expense of wealthier ones.

Under the state board’s proposal, however, no district would have to raise taxes or lose current revenue to others, said board member Dave Thomas.

“Our principal task was to make sure there are no losers, that all students in Utah are winners through this,” Thomas said.

The first part of the proposal would allow districts to raise the rate of one type of property tax, known as the voted leeway, above their current rates for that tax. Then 5 pe rcent or more of the extra amount earned would be redistributed to districts throughout the state. The second part of the proposal would freeze another type of property tax rate, known as the basic levy, allowing the state to collect and redistribute more money as property values rise. The third part would consolidate different types of property tax revenue that districts now receive to give them more flexibility in spending that money.

It’s the fourth part of the proposal, however, that’s likely to cause the most heartburn.

That part recommends a new statewide property tax to help pay for charter schools, and would cost about $24 for a home valued at $150,000. That would replace the money districts now have to send to charter schools because charters can’t raise their own taxes, a strategy that has caused friction between districts and charter schools for years.

Tom Morgan, chair of the State Charter School Board, said a statewide tax seems like the fairest way to fund charter schools since traditional public schools are also partly funded through property taxes.

 “It will help us have better relationships with districts because right now charter schools are taking some of the districts’ money away,” added Tim Beagley, State Charter School Board vice chair.

Some, however, voiced concerns over the proposal, and a number of state school board members voted against it, though it ultimately passed.

“Charter schools were supposed to be this cheaper thing that didn’t need all this money,” said state board member Denis Morrill. “Now, little by little, they aren’t saving us any money.”

Morrill said such a tax would give property owners no say over how their dollars are spen t. State board member Leslie Castle expressed concern about taxing all property owners when some areas have no charter schools.

Thomas, however, said it’s fair to tax those people for the same reason it’s fair to tax elderly and childless people for schools: Having an educated citizenry benefits the state as a whole.

Thomas acknowledged Friday that the four-part proposal wouldn’t eliminate all the funding disparities between school districts, but he said it would help.

“There’s always going to be a disparity because we believe in local control, that citizens within a school district can decide for themselves if they want to tax themselves more,” Thomas said. “This is just a method by which we can help to equalize.”

The board will likely present its proposal at the next legislative Education Interim Committee meeting Oct. 20.