Fayette school board proposes property tax rate to generate 4 percent revenue boost

The Fayette County Public Schools board on Friday proposed adopting a 2021-2022 property tax rate that will generate a 4 percent increase in revenue.

The board proposes to levy a total rate of 80.8 cents for real estate and 80.8 cents for personal property per $100 assessed valuation.

That is 0.2 cents less than last year’s real estate rate. That means that a person with a home valued at $100,000 would be paying $2 less per $100,000 than last year. However, board member Stephanie Spires noted that a homeowner’s property tax bill may increase because of an increase in the house’s assessment or taxable value upon which bills are calculated. The school board doesn’t oversee property tax assessments.

The 4 percent increase in revenue could generate $11.5 million. Board chair Tyler Murphy and Spires wanted to make sure the public understood it was not a 4 percent increase in the property tax rate but in the revenue collected.

A public hearing and board vote is set for Aug. 23. The board has other options, including no changes to the tax rate.

The working final budget will be announced and approved in September.

The district officials previously announced a $598.7 million tentative general fund budget, which was predicated on a $6.5 million conservative estimate of local property tax revenue increase.

The board wants to implement a marketing plan and use talking points to explain to the public what it is doing. New school board members Tom Jones and Amy Green asked for more information on the budget, so more work sessions are planned.

“We need to have some kind of detailed budget that explains where the money is going,” said Jones.

New Superintendent Demetrus Liggins said in a message to families school boards across Kentucky have the responsibility of setting property tax rates to generate revenue to pay for their local schools. Those rates are calculated based on the total value of commercial properties and homes in each community.

He said thanks to the healthy real estate market, home prices in Lexington have risen over the past year. And that will allow the school board to lower the tax rate and still generate revenue for initiatives that include:

Expanding the Rise STEM Academy for Girls and open the Carter G. Woodson Preparatory Academy, and purchase textbooks and instructional resources for all schools.

Increase salaries for FCPS employees for the first time in five years, cover increasing utility rates and insurance costs, pay teachers for an additional day to prepare their classrooms, and adjust the salaries of hourly employees to acknowledge prior industry experience.

Between 2000 and 2015, in all but one year, Fayette County Public Schools raised the property tax rate so that it generated a 4 percent increase in revenue. But the school board has not raised the property tax rate for the last three years.

In September 2020, the late Superintendent Manny Caulk said he did not feel it was the right time to ask for a higher tax rate given the economic challenges the coronavirus pandemic caused families in Lexington.

As a result of his recommendation, the school board decided for 2020-2021 to levy a total rate of 81.0 cents for real estate and 76.0 cents for personal property per $100 assessed valuation and a total motor vehicles property rate of 59.2 cents per $100 assessed valuation.

That was unchanged from the previous year.

In April, then Chief Financial Officer John White said Fayette schools faced a future budget deficit if the school board didn’t raise property taxes despite getting $155 million in federal COVID stimulus money. That projection wasn’t mentioned at Friday’s board meeting.

This story was originally published August 6, 2021 at 3:37 PM.