CHENEY – Despite uncertainties with the economy, the Cheney School District’s ending fund balance has remained relatively stable.
While tracking less than it did in 2017-2018 and 2018-2019 beginning in February and running through April, the reserve cash fund needed to help pay operating costs is still above $3 million — a level it might approach at the end of this month. But after dipping to just over $4.5 million in March at the beginning of the COVID-19 school closures and economic shutdowns, the fund saw a resurgence in April to just over $6.61 million thanks to property tax collections.
Finance Director Jamie Weingart told the school board at previous meetings the district was unsure what to expect in the way of collections due to Spokane County Treasurer Michael Baumgartner’s decision to extend property tax payments from April 30 to June 15. That and the stresses imposed on the economy due to the shutdown has led to the county seeing about a 5 percent drop in collections through May 31.
That held true for the district as well, Weingart told the board at their May 27 meeting, as April collections fell from 52.90 percent in 2019 to 46.53 percent in 2020. Even so, that still puts Cheney not far behind last year’s rate.
“We’ve seen a few things trickle in slower but for the most part we saw most of our patrons and big payers pay their property taxes in April as planned,” she said.
According to a June 4 news release, Baumgartner said in a normal year the county expects to collect about 99 percent of property taxes, and 95 percent in “a bad year.” Impacts from the coronavirus shutdown could be “unprecedented.”
“As those impacted spend through their reserves, we expect the most significant impact will likely take place in the fall collection period and may drop to 90 percent collection for the year,” Chief Deputy Treasurer Mike Volz said in the release.
Even with the drop in collections, Baumgartner said the total dollar amount collected so far this year exceeds what was collected in 2019 due to increases in local government and school district budgets. The 2020 tax roll is projected to increase by $80 million — 13.6 percent on average — this year, with 38 percent coming from voter-approved levies and bonds.
In February 2018, 61 percent of Cheney School District voters approved a three-year educational programs and operation expenses replacement levy scheduled to collect an additional $6.4 million in 2020 and $7 million in 2021. Baumgartner said the increase in dollar amount was causing frustration among tax payers.
“The most common complaint has been why the portion of property tax that pays for schools needs to be paid even though they have been shut down and education moved online,” he added.
Property taxes are calculated based on assessed property values and proportionate share of taxing district budgets. They are certified at the beginning of each year.
Weingart also told the board the district could be in line to receive some federal funding to pay for COVID-19 related expenses, funding that would first be passed through the state. Preliminary calculations by the Office of the Superintendent of Public Instruction puts Cheney’s possible allocation at up to $689,000. Weingart said there are still many questions surrounding this funding, and that it could only be used for expenses related to COVID-19. The money would also be a one-time disbursement, and could be pulled back and administered by the state if directed to do so by the Legislature.
“It’s not something that we’ll see in future years even though we’re likely to see the effects of this situation for multiple years to come,” Weingart said. “This is a one-time payment so it really has to do with the unexpected costs this year related to the situation we’re in.”
John McCallum can be reached at jmac@cheneyfreepress.com.
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