SJR 028 - Fiscal Note

Fiscal Note - SJR 028 - Allows revision of school district tax levies in cities

COMMITTEE ON LEGISLATIVE RESEARCH

OVERSIGHT DIVISION

FISCAL NOTE

L.R. NO. 2884-01

BILL NO. SJR 28

SUBJECT: Constitutional Amendment: Property Tax and Education

TYPE: Original

DATE: February 5, 1998

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FISCAL SUMMARY

ESTIMATED NET EFFECT ON STATE FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
General Revenue	($55,300)	$0	$0
Total Estimated Net Effect on All State Funds	($55,300)	$0	$0

ESTIMATED NET EFFECT ON FEDERAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
Total Estimated Net Effect on All Federal Funds	$0	$0	$0

ESTIMATED NET EFFECT ON LOCAL FUNDS
FUND AFFECTED	FY 1999	FY 2000	FY 2001
Local Government	$0	$0 to Unknown	$0 to Unknown

Numbers within parentheses: ( ) indicate costs or losses

This fiscal note contains 3 pages.

FISCAL ANALYSIS

ASSUMPTION

Officials of the State Auditor and the State Tax Commission reported this proposal would not affect their agencies, administratively.

Oversight notes that school districts must have a levy of at least $2.75 to qualify for full funding under the foundation formula and assumes that raising the rate which may be imposed without a vote to $2.00 would not have a large fiscal impact. However, the proposal would have the effect of raising the maximum levy which could be imposed by simple majority vote (instead of a two-thirds majority vote) from $3.75 to $6.00. (According to Tax Commission records, the difference in proceeds from an $6.00 rate and the tax rate ceiling rates for school districts would have been $1.1 billion in 1995. This would be the maximum possible increase in revenue to school districts if the voters would have approved.)

Advertisement costs for the proposal would be $3,990 per newspaper column inch for three publications of the text of the proposal, the introduction, title, fiscal note summary, and affidavit. The proposal would be on the ballot for the November 1998 general election.

FISCAL IMPACT - State Government	FY 1999	FY 2000	FY 2001
Cost to General Revenue Fund
Secretary of State
Newspaper Advertisements	($55,300)	$0	$0
FISCAL IMPACT - Local Government	FY 1999	FY 2000	FY 2001
Income to School Districts
Increased Taxes	$0	$0	$0
		to	to
		Unknown	Unknown
FISCAL IMPACT - Small Business

Small businesses would be affected by any higher property tax rates enacted as a result of this proposal.

DESCRIPTION

This proposal would: 1) raise the maximum tax levy which school districts formed of cities and towns could assess without voter approval to $2.00 per one hundred dollars assessed valuation

DESCRIPTION (continued)

from $1.25 per one hundred dollars assessed valuation, and 2) allow the Kansas City school district (or any successor district or districts) to set an operating levy for school purposes at less than the court-ordered rate for the 1995 tax year and to change the levy from year-to-year so long as any rate greater than the court-ordered rate for the 1995 tax year would be approved by a majority of voters of the school district.

This legislation is not federally mandated, would not duplicate any other program, would not require additional capital improvements or rental space, and would not affect total state revenue.

SOURCES OF INFORMATION

State Auditor

State Tax Commission

Secretary of State

NOT RESPONDING: Kansas City School Board; City of Kansas City

Jeanne Jarrett, CPA

Director

February 5, 1998