School braces for $450K cut in state funding

McCOOK, Neb. — The "Pillen Plan" will likely result in a $450,000 loss to McCook Public Schools and force raising property taxes to the limit, Superintendent Grant Norgaard told board of education members Monday night.

The new TEEOSA school funding formula may see the citizens facing the highest tax levy allowed at $1.05 per $100 of valuation.

“We can’t generate enough revenue to operate our school system based off of a state formula,” Norgaard said.

In Nebraska, over 70% of the costs of operating its public school systems come from property taxes, while nationally only 43% comes from property taxes. Norgaard went on to explain, “McCook is in an equalized school district and cannot raise enough money off our local property taxes and needs additional support from the state.”

Equalized districts have low property values compared to the number of students they educate. “Generally speaking, if you are unequalized, meaning you don’t get equalization aid, you can have lower levies than equalized”.

Business Manager Jeff Gross and Norgaard reviewed the original projection for state aid receipts, and it that one looked like the school district was going to be able to lower the levy.

When the new projection by the Nebraska Department of Education predicted a $450,000 cut to McCook, officials were advised to raise the levy to the maximum amount allowed to offset inflation and the loss in state aid.

Instead of the expected $700,000 increase, the $450,000 loss is due to the state sending money out to schools that traditionally did not receive state support for their operations.

Gross said in last year’s budget, the district received $1.4 million in equalization in poverty dollars as part of the TEEOSA formula.

He was originally anticipated that amount going up to $1.7 million, and actually submitted to the state $2 million in poverty dollars.

In the latest calculation, the district’s poverty dollars will be in the $580,000 range for next year. “So, they [the state] had to slash somewhere and that’s where they slashed,” said Gross.

Norgaard acknowledged that the state is increasing funding for special education, saying that McCook will receive more dollars for special ed, but is unsure of whether it is going to be enough to prevent the district from having to ask for more local property tax support. “Yeah, we are hoping that the special ed increases offsets, and we are still in a good spot, but there’s no guarantees, and just looking at the numbers preliminarily, it doesn’t look that way, but we will have to see,” he said. “Nothing is final yet, we just want to be prepared for the year as best as we can be.”

The school board also approved the contract to bring Jill Patel, for the position of high school special education teacher. McCook reduced the number of special education teachers a few years ago and is back to the point where it needs one extra person to help with extra caseloads.

The board also voted to approve a $35,000 maximum total salary increase that is to be spread out between the eight administrators, which includes all the principals, assistant principals, and the activities director.