Despite declining property tax revenues, the Newton County Board of Education was unable to raise its millage rate because it was already at the max rate of 20 mils.
The board of education approved a maintenance and operations millage rate of 20 at its July 17 meeting, less than the rollback rate of 22.064. The rollback rate is the rate at which the school system would collect the same amount of tax revenue given reduced property values.
However, the board did vote to increase the debt services millage rate because of declining revenues tax revenues and the addition of interest payments from bonds issues in 2012. School system Superintendent Gary Mathews recommended the board increase the rate from 1.073 to 1.9 mils.
Both millage rates have steadily increased during the years. The maintenance and operations millage rate was at 18.21 from fiscal year 2007 until 2011 when it was raised to the cap of 20 mils. Similarly, the debt service rate was at 1.00 from 2007 to 2011, increased to 1.073 in fiscal year 2012 and will now rise to 1.9.
At the combined millage rate of 21.9, the school system expects to collect net tax revenue of approximately $39 million, a decrease of around $4.5 million (10 percent) from last year's collections.
In May, Newton County Chief Tax Appraiser Tommy Knight said the total tax digest was expected to drop between 10 and 11 percent. The net tax digest, which is the value of all land, buildings, vehicles and equipment in the county, was $2.17 billion last year, but a 10.5 percent decline would bring it down to $1.94 billion. Both the Newton County Board of Commissioners and the board of education base their tax rates off the county's net tax digest.
When asked at the time, Knight said he didn't see the local real estate market getting significantly better for the next three years. Foreclosures are expected to remain high, which is likely to continue to push home prices, and tax revenues, down.