School district levy draws questions, support

SANDPOINT — The Lake Pend Oreille School District is asking voters to approve a replacement supplemental levy next month, and district officials and others have been making the rounds stumping for a positive outcome.

One area resident, however, recently took exception to a piece of information the school district is using to support the levy. The school district claims its levy rate is “50 percent below the state average” on its website.

Sandra Rutherford of Sandpoint recently emailed the Daily Bee and cited a Jan. 6 Idaho Statesman article that identified the 10 largest proposed supplemental school levies in the state. It ranked the LPOSD’s $7,883,742 supplemental levy as the seventh highest in the state in total levy dollar amount.

Rutherford wrote: “The school district states that the tax rate is 50 (percent) below the state average, but this is not the same as the levy. ... With a levy vote coming up, the voters need to know the truth. A listing of the top ten levies would do that.”

So which is it? Is the district’s levy the seventh largest in the state, or is it less than half of average statewide levy rate?

It’s both, actually. Although the question is valid, she’s comparing apples and oranges.

An example

Here is an illustrative example that everyone can relate to, but has nothing directly to do with school levies.

You go to the hardware store and buy a $100 tool, and — dang — you get nailed with a $6 sales tax charge. The next week you buy another $100 tool, but this time from a store in Spokane, where you’re charged $8.70 in sales tax. Angry at the high taxes in Washington, you resolve to never buy anything in the Evergreen State again. Back in Idaho, you make another trip to the hardware store and purchase a $200 tool. Your sales tax bill is $12.

Say what? Aren’t Idaho’s taxes lower? Why the differences in sales tax amounts?

First, Washington has a higher sales tax “rate” than Idaho. But even in Idaho, how much you actually spend dictates how much you’ll be charged in sales tax. It’s a graduated tax, a percentage of the total sale — the more you buy, the more sales tax you pay.

It’s the same with a levy, and hidden in the above example is the clarification Rutherford is seeking. The key to the amount of total tax revenue a school levy generates is the rate, or percentage, of the levy, multiplied by the amount being taxed.

Market valuation

So what is the amount being taxed? That number is based on the combined, assessed value of all the taxable property within the school district boundary.

Each property owner pays their individual share of the levy based on the assessed value of their property, multiplied by the levy rate. To calculate the levy amount, all those property owners are lumped together into one big value assessment for all the taxable property within the school district boundary. That number is referred to as the “valuation.”

According to the office of the state Superintendent of Public Instruction, the valuation for the LPOSD is $4,253,673,023. Yes, there is just over $4 billion in taxable property in the district.

Levy rate: supplemental and total

A levy rate is then applied to the district valuation to get the total levy amount, similar to the sales tax rate applied to the tools bought at the hardware store in the previous example.

The LPOSD has two levy rates: a supplemental levy rate — used to calculate the levy currently before voters — and a “tort” levy rate.

The district supplemental levy rate is 0.185 percent, or just over one-sixth of one percent. The tort levy, which isn’t a voter-approved levy, but is instead provided by Idaho law, is 0.00425 percent. The total levy rate for the district is just over 0.189 percent.

The total levy rate is the number with which Rutherford took exception.

Here are the numbers: the average statewide levy rate is 0.365, or just over one-third of one percent, according to data from the state superintendent. That’s exactly 49.24 percent higher than the LPOSD total levy rate.

Put another way, the school district’s total levy is exactly 50.76 percent lower than the statewide average. Close enough to the LPOSD claim that it is “50 percent below the state average.”

That’s the apples. Now for the oranges.

Levy amount

Again, the levy amount is calculated just like a sales tax: if you know the price of an item, you can determine the tax.

Based on the school district valuation and the levy rate, the levy amount is $7,883,742 per year for two years.

One important note about the levy amount: it remains fixed during the two year levy period. The valuation and the rate are point-in-time numbers used to determine the levy amount. So the value of homes in the district may rise due to a red hot real estate market that drives the value of homes upward during that period, but the levy amount won’t change. At least not until the next levy vote in two years, when a new levy amount, based on a new levy rate and district valuation, will need to be justified to voters all over again.

How the district stacks up

So is the LPOSD the seventh highest levy amount in the state? Yes, at least in the category of a supplemental levy.

For context, and strictly for comparison, if that levy rate were used as the state sales tax rate, rather than paying $6 in sales tax for the tool used in the example above, you would instead pay 18 cents.

In context, the Independent School District of Boise has a market valuation of $16,476,091,784, and a levy rate of just over one half of one percent. If approved, the Boise levy will generate $86,218,400. With approximately 25,000 students, the Boise levy is generating $3,449 per student. The local levy comes in at $2,194 per student.

Meanwhile, the LPOSD continues to make a good educational showing. State test results show seven years of “positive growth” in the district.

“Ten of our 11 schools are either four- or five-star schools,” as rated by the state of Idaho, LPOSD Superintendent Shawn Woodward said in an interview in January.

Sandpoint High School has been at or near the top of the Scholastic Aptitude Test compared to other schools of its size in Idaho. It was first in math, reading and critical writing last year, Woodward said.

U.S. News and World Report rates SHS seventh overall in the state, higher than the Idaho state average in college readiness, math and reading. Both SHS and Clark Fork High School are “nationally recognized” by the magazine, which scores schools in a number of areas, including standardized test scores, success of economically and least-advantaged students, and overall college readiness.

Whether the levy rate and the subsequent levy amount it generates is a good investment will be up for voters to decide, when they give it the thumbs up or down on Tuesday, March 10 at the polling booth.

In terms of the availability of information goes, the LPOSD is very transparent. A large amount of data and information is available on the district website at www.lposd.org. Scroll to the bottom of the page and click on the link under “Supplemental Levy Election March 10, 2015,” to access district information.