Senate Finance amends bill to raise property taxes for schools

Ryan Quinn , Staff Writer

West Virginia’s Senate Finance Committee changed Monday the bill that would cut about $79 million in state funding to public schools next fiscal year into more of a straightforward statewide county property tax increase bill.

In the new version of Senate Bill 609, county school boards could decide to opt out of the tax increase on their residents if they’re willing to take the significant financial hit. Kanawha County would see the largest total funding loss if it chose to completely opt out of the tax increase: $9.3 million.

The bill was amended in a voice vote, then it passed out of the committee to the Senate floor on a 12-6 party-line vote, with Republicans voting yes and Democrats opposed.

The previous version of SB 609 the Senate Education Committee passed would’ve cut the $79 million and newly allowed school boards to vote to opt in to increasing their regular levy property tax rates to make up for the state funding loss.

Amy Willard, executive director of the state Office of School Finance under the Department of Education, said if school boards raised their regular levy tax rates to the maximum allowed under the previous version of SB 609, they would effectively have no funding change next fiscal year.

The new version of the bill automatically would increase the regular levy rate to the maximum in each county. Willard said the current planned rate for class 2 property next fiscal year — owner-occupied residential property and farms — is 38.8 cents per $100 of assessed valuation, and the new rate under the bill would be 45.9 cents per $100 of assessed valuation.

She previously has said the change would mean a person with a home appraised at $75,000 would pay $31.95 extra on his or her annual tax bill for that home, while someone would pay $42.60 extra on a $100,000 home.

“I know that my counties in the southwest coalfields are distressed,” said Sen. Ron Stollings, D-Boone. “There is a lot of homes that are in bankruptcy, a lot of cars that are repossessed, a lot of people are trying to move, a lot of homes for sale, and the last thing they need is a tax increase.”

But he said he heard “optimistic news today that there are some things moving in the House that might actually raise some revenue for us, maybe a food tax, maybe a sales tax, that would pre-empt this.”
“I think we ought to have our big boy pants on and be able to do this ourselves without pushing it back to the counties,” Stollings said.

Sen. Corey Palumbo, D-Kanawha, noted on Saturday, Democrats and Senate Finance Chairman Mike Hall, R-Putnam, expressed concerns about the previous version of the bill possibly violating the state Constitution and the Recht decision if not all school boards agreed to raise taxes.

“How is this any different from that perspective if we’re pushing everybody up and then some back it back down?” Palumbo asked.

In the landmark 1980s Recht decision, Ohio County Circuit Judge Arthur Recht found the state’s public schools failed to meet a “thorough and efficient” standard demanded by the state Constitution and ordered an overhaul of school financing with the idea that children from high and low property value counties should receive the same education.

“There are those people who believe that if the Recht decision were revisited the outcome may be different,” Hall said after the meeting. “So it’s not unconstitutional until a judge says it is.”

“It’s obvious that this bill has not made it all the way to passage, this is its first start, it’s not its destination, should other revenue sources surface, this bill will be absolutely unnecessary,” Hall said.

He said the Democrats are “in a position to vote no on any tax increases, and they’ve got us in an odd position of trying to find revenue,” for public education and other programs.

“They’re going to vote no so they can probably say to the voters out there, ‘Hey, we didn’t raise your taxes, they did,’ but the economy didn’t fall apart under us, it fell apart under them,” Hall said.

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