By Logan Wells, News Director | Logan@kymnradio.net
On Wednesday, we launched a series to explain the Northfield School District’s budget and tax levy, ahead of its Truth in Taxation meeting on Monday. On Wednesday, we looked at the different revenue sources for the district.
Today, we are reviewing the historical trends in school districts’ tax levies. Overall, this year is set to see a 0.98% decrease in the tax levy. Unlike other local governments, school districts are far more regulated in when they can raise taxes, leading to generally small changes. For example, in 2022 there was a 1.6% decrease and in 2023 a 5.6% increase. The major change came last year, when voters approved new taxes for the High School Reimage project. State law requires the district to levy a tax equal to 105% of the debt payment due. Here’s District Director of Finance Val Mertesdorf in 2024 after the referendum:
Listen to the News:
“And so the preliminary levy tax impact calculation was actually a reduction of your school district taxes across the board across all categories, if I’m recalling correctly. Because there was additional market base, but our levy didn’t go up by a percentage that exceeded that. And so most people saw a reduction in their school district taxes. Now obviously our final levy looks a little different.” [Because of the passage of the High School Renovation Referendum]. – Northfield Public Schools Director of Finance Val Mertsdorf at the 12/9/2024 School Board Meeting
Last year, the School District’s tax levy increased 26.4% for the High School. The overall budget for the High School project is $120 million.
The district is staggering the debt issuance and tax increases in two stages. The first round of bond sales was $39 million this past spring, and the second round will be $80 million in the summer of 2027. The $2 million donation from Carleton College is also being allocated across both bond sales, reducing the amount needed to borrow.
During this past spring, the first bond sale proved to be quite competitive with 13 interested buyers from across the nation. The competition lowered the interest rate on the bonds from the estimated 5% to 3.9% Shelby Mquad of Ehlers, the school district’s financial advisor, told the school board that the lower interest rate would result in $8 million in savings over the life of the debt.
The School Board meets for its Truth in Taxation meeting on Monday evening. Monday’s newscast will break down the budget and Tax Levy for this year.
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