Gwinnett County property tax revenues have fallen so far and so fast that the school system can’t keep up with payments on its long-term debt without going back to taxpayers for more money.
That’s the main reason why the school board is expected to vote tonight to raise property taxes for the first time in eight years, officials said.
The proposed tax increase would add an extra $75.80 to the tax bill on a $150,000 house, or $101.80 on a $200,000 house, according to school system projections.
More than half of the extra money that’s raised will go to cover $47 million in principal and interest that the school system will owe in fiscal 2014 on long-term debt it has been carrying from 2008 or earlier, said Rick Cost, chief financial officer.
Until the housing market collapse, which had the domino effect of bringing down property values and property tax collections, the district was able to meet its debt payments without raising taxes, Cost said.
But between 2009 and 2013, a 1.30-mill of tax dedicated to paying the district’s long-term debt went from bringing in $40 million a year to bringing in $31 million a year in 2013, he said.
The extent of the loss was one “we couldn’t even imagine,” Cost said. “Nobody could have.”
For the last two or three years, the district has filled in the gap by tapping into reserves and other savings, he said.
“We delayed as long as we could what is now the inevitable,” he said of the proposed tax increase.
The debt service applies to about $564 million in outstanding general obligation bonds that voters approved over the years, largely to build more classrooms as the district’s enrollment surged, Cost said.
Another large chunk of money from the tax increase will be used to wipe out unpaid furlough days for most school system employees. Longtime school board member Louise Radloff said school board members were concerned about the potential impact on “teaching and learning.”
Most school system employees had two unpaid furlough days in each of the last two school years, and three in the 2010-2011 school year.
The school district also plans in the new fiscal year, which starts July 1, to hire 18 school resource officers, or police officers, one for each of the sprawling district’s school clusters.
After well-publicized school violence, including the massacre in Newtown, Conn., board members said Gwinnett parents made clear that they wanted the district to step up its efforts to keep students safe.
The district is projected to have 166,667 students in the 2013-2014 school year, up from 164,977 this year.
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