The annual budget approved Monday by the School District 2 Board of Trustees takes advantage of new provisions approved by the state Legislature while putting more money into the district’s reserves.
Trustees adopted annual operating budgets for elementary and high school districts totaling just more than $151 million.
About three-quarters of that money goes to elementary and high school general funds, which are used to pay for salaries, benefits and supplies.
The district did not seek a levy to increase the general funds this year, but the funds fluctuate with student enrollment changes.
“Overall, there shouldn’t be any surprises,” chief financial officer Leo Hudetz said.
The general fund adopted for the elementary district increased $73.6 million, $3.7 million over last year, due primarily to a bump in state dollars that are tied to enrollment. It includes salaries for five new teachers.
Total revenue for the high school district general fund dipped slightly, but total expenditures were set at more than $1 million more. The budget eliminates a net revenue seen in the past fiscal year.
Total property tax bills will be significantly higher this year, however, thanks primarily to debt service tied to a series of recent voter-approved bonds.
Trustees also elected to exercise a new authority granted to them by the state Legislature last year that allows districts to issue a non-voted, or permissive, levy to cover the costs of special education.
The option frees up space in the general fund to be used for other purposes, effectively increasing the total tax bill. The provision especially helps larger districts like Billings, which have higher numbers of students with special needs.
SD2 has 75 students eligible under the law this year, meaning their cost of education exceeds state and federal subsidies already in place.
District officials recommended levying $492,000 to cover 19 of the students who have the greatest needs.
“We feel like going forward, based on where we see our funding needs, that this would be a middle ground,” Hudetz told the board.
But trustees decided Monday to maximize their authority and voted to levy about $1 million for the purpose, saying to do otherwise would send the wrong message to legislators.
“This is what the legislators gave us,” Teresa Stroebe said, “and if we don’t use it, I’ll feel really bad going back to them saying, ‘help us.’ ”
The increase to the levy adds about $15 annually on a home with $200,000 in taxable value.
Property tax levels for all funds in elementary and high school districts, including bond debt service, will rise by just over $85 annually on the same home.
At the same time, the district boosted its reserves to the highest levels in at least five years in preparation for transition costs associated with opening new schools, Hudetz said.
The elementary budget was approved unanimously, while Stroebe voted against the high school budget, saying she was concerned about the drop in mills.
SD2 is still waiting for figures related to the final portion of a state tax settlement with Charter Communications, but Hudetz said he expects the district’s cut will match the amount it has borrowed to cover protested taxes during the last few years.
“When all is said and done, we’ll be able to pay all of that off, and maybe have a little extra to put into our reserves,” he said.