By Myrna Trauntvein
Times-News Correspondent
A recent building construction
conference about new construction which needs to take place
in Juab School District did not paint a rosy picture of the
near future.
In fact, district board members
are questioning the actual feasibility of adding new
buildings to the district.
"The building costs are even
worse than when we started conversations about building,"
said Darin Clark, clerk/treasurer for the
district.
Proposed is a new elementary
school, remodeling the older Nephi Elementary school and
adding classrooms to the Mona Elementary school.
Building costs are, at present,
$150 per square foot, said Clark, and they may continue to
escalate due to the pressure caused by increasing fuel
costs.
"We have a tight calendar if we
want to have the question of bonding for a new school on the
November ballot," said Clark, "we need to make some
decisions."
"The big question in my mind,"
said Leon Pexton, board president attending meeting
electronically, "is whether building construction costs will
be sustained or whether it is a bubble that will
decrease."
Wise decisions made by the board
in the past would allow some evaluation time, he said. There
was a need for buildings, however, the district did have
some breathing room created by building a new high school
and allowing some wiggle room for the future.
"We might have to add some more
portable classrooms to existing school sites," said
Superintendent Kirk Wright. "We would have enough space to
handle the school population for a couple of
years."
There were several more
subdivisions in the works for the Nephi area, said Delanie
Hathaway, board vice president. Those types of homes brought
young families to the district meaning that school
populations would increase at some point.
"Construction costs may do
nothing more than flatten out," she said. "They, most
likely, will not go back down."
It isn't only increased building
costs that has the school board guessing.
"We have to have the valuation
numbers before we can make some decisions," Clark said. The
state tax commission said that those numbers were not yet
ready and to call back on the first of June."
The state tax commission, Utah's
revenue agency, administers state tax laws and collects tax
revenue and they also set the valuation rate for centrally
assessed property.
Those properties are ones, such
as the PacifiCorp power plant near Mona.
Utah Code Ann. Section 59-2-201
(1996) outlines the statutory property tax valuation
mandates the tax commission must follow.
One of those is that by May 1 of
each year, the following property is to be assessed at 100
percent of fair market value as valued on January 1 of the
taxing year: (1) property operating as a unit across state
and county boundaries; (2) all property of public utilities;
(3) all operating property of an airline, air charter
service, or air contract service; (4) all geothermal fluids
and geothermal resources; (5) all mines and mining claims;
and (6) all machinery used in mining, and all property or
surface improvements upon or appertaining to mines or mining
claims.
"When we are looking at building
an 80,000 square-foot building, even if building costs go up
just $10 a square foot, we are looking at an increase of $1
million," said Wright.
The state earmarks individual and
corporate income taxes for spending on public and higher
education and income from School Trust Lands pays for public
education. Numbers will pay an important part in determining
what the district should do about building more
schools.
Determining the school population
for next year is, somewhat, a guessing game also.
"We are going to grow in the
summer," said Wright. "Just how much is the
question."
For example, the sixth grade
class is a large one, and having it move up the line might
help with individual school populations. The enrollment for
Mona Elementary seems to be a little less next year than it
is this year.
Nevertheless, said Hathaway, the
district may need to look at some different ways to
structure the debt that may need to be incurred in order to
build schools.
Utah's public school finance plan
is a modified foundation program; its official title in Utah
is The Minimum School Program. The foundation grant, which
guarantees each student a minimum level of fiscal support,
is only one component of the Minimum School
Program.
The value of the foundation
grant, described in Utah as the value of the Weighted Pupil
Unit (WPU), is set each year by the legislature. School
districts are required to tax local wealth (assessed
valuation of local property) using the program's Basic Tax
Rate, which is also set by the Legislature. The difference
between what can be raised locally by the Basic Tax Rate and
the amount guaranteed by the state, is paid by revenues
generated from the State's Uniform School Fund, primarily
personal income tax&emdash;constitutionally earmarked for
this purpose.
Wealthy districts, using the
Basic Tax Rate, capable of raising revenues greater than the
value of the foundation grant are subject to
recapture.
Recaptured funds become revenue
to the Uniform School Fund the following year. Finance of
the foundation grant is heavily supported by the state,
which pays for about 72.6 percent of its total. On average,
school district revenues account for $508 of the $1,854
guaranteed by the state.
Consistent with the basic
structure of a school finance foundation plan, Utah's 40
school districts are able to levy a number of additional
taxes (13 in total) against the value of their local
property.
"We will have a conference call
on June 1, after the state tax commission numbers are
available," said Hathaway. "We can determine our next step
at that time."
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