Taxing situation: Cost of city vs. school operations
Rourke wants transparency in property tax bill
LOWELL >> City Councilor Daniel Rourke would like to see more information and transparency in the property tax bills the city sends out to residents. Not so fast, some of his fellow councilors said, citing factors like cost to the city and confusion for taxpayers.
Rourke’s motion made during the Feb. 21 meeting requests City Manager Tom Golden report on the feasibility of issuing two separate tax bills: one for city operations and one for school operations.
“The reason for filing it (the motion) is for some transparency,” Rourke told the chamber. “Some cities and towns do a page or two detailed report of the budget breakdown and the taxes. I was surprised to learn the breakdown between the city side and the school side myself, so it would probably help the public as well, going forward.”
He asked Chief Financial Officer Conor Baldwin for a breakdown of the current fiscal year.
According to Baldwin, the total city budget, including the enterprise funds, is $502 million. From that amount is almost $214 million — including Chapter 70 funding — for the School Department.
The three enterprise funds for the city are water, wastewater and parking, while Chapter 70 funding is state aid to local school districts like Lowell.
The fiscal 2023 budget included a call for a 5.5% property tax increase, which Baldwin noted totaled almost $165 million, or 35% of the budget.
As previously presented by Baldwin, 49% of the budget’s funding also comes from intergovernmental revenue, such as the American Rescue Plan Act, and charges for services represents 15%.
It’s that kind of detail Councilor Kim Scott thought might be useful to the taxpayer even if she
didn’t support the idea of two separate bills being sent out.
“I do think it would be helpful, possibly within the real estate bill, to have an insert that shows our city budget that has the graph that shows the breakdown between the different city departments, so people can see how we spend their money,” she said. “So residents get information on how we’re spending money.”
Baldwin told the council that the $38 million Lowell High School rebuild overrun is a debt service that “will be paid by the city budget. It does not count towards net school spending.”
State Sen. Ed Kennedy has filed legislation, listed as Senate Docket 2395, that would earmark no less than $150 million of federal COVID-19 recovery funds for the School Modernization and Reconstruction Trust Fund. The Massachusetts School Building Authority uses that trust to fund school building projects. Kennedy hopes the bill will help Lowell and other communities in the commonwealth address the cost overruns to their school rebuilding projects.
Also not counting toward net school spending is $2.3 million that was appropriated by the City Council for improvements in the school buildings and on school grounds.
The MSBA’S Accelerated Repair Program projects, the latest batch of which was approved by the council in January, includes boilers at the Butler, Bartlett, Robinson, Shaughnessy and Mcavinnue schools. The expenses are incurred by the city and do not count toward net school spending.
Likewise, the City Council committed $7 million to HVAC improvements throughout all municipal buildings, but the biggest expense, said Baldwin, will be in the schools.
Councilor Rita Mercier stated that while she supported the feasibility report aspect to the motion, she would not be in favor of sending two separate tax bills breaking out the city and school sides of operations.
“I’m for the report, but I’m not for two bills,” she said. “People have a hard enough time paying one bill.”
Transparency was on Councilor John Drinkwater’s mind, but not at the cost of clarity. He worried that two bills would perpetuate the notion that “public school should be a fee-for-service.” Drinkwater noted that while door-knocking during his campaign, he frequently heard from residents without children in the system, who flinched at tax revenues underwriting the cost of education.
“I’ve heard it time after time, which is, ‘I don’t have kids in the schools. Why am I paying so much in taxes for our public schools?'” he said.
Ultimately, said Baldwin, if the administration can make tax bills easier for residents to understand, “we will report back to the council on a way that makes the most sense.”
The motion passed with eight yeas, with Drinkwater, Wayne Jenness and Erik Gitschier voting no.