County school board members voted last week to approve a resolution to place on the May 20 ballot the question of extending the current special purpose local option sales tax until March 2021.
The tax, projected to generate $87.6 million over five years, is needed to pay off debt and provide such capital needs as upgraded technology in schools, school officials told board members.
District 1 board member Theresa Lyons said she supported the resolution to place the renewal before voters. Top priorities for the tax, if renewed, include paying off bond indebtedness and upgrading the school system’s technology resources for students, she said.
Governmental entities often use bonds – essentially, loans which must be repaid with interest – to pay for capital projects. Lyons noted the school system used bonds to build 20 schools in 17 years in response to the county’s rapid population growth in the 1990s and 2000s.
“Now, we are still paying for those schools,” she said.
School officials told board members that, despite the district not issuing bonds since 2008, it will have $99 million in debt by the end of the current tax in March 2016.
About half the money generated from the continuation of the tax – $43.4 million – is planned for debt service.
“Provided that projected collections are met over the five-year life of the program, the citizens of Paulding County would continue to enjoy no school bond millage,” school district officials said of the proposed renewal.
The school board currently does not impose a millage rate dedicated solely to paying bond debt because it determined the money raised by the current sales tax would offset the need for property taxes.
However, if not approved, the school district would need additional property taxes to pay bond debt, which would likely increase the total millage rate by 17 percent, officials said. Such an increase would add about $257 to the annual bill on a $200,000 home, they estimated.
“We prefer to be able to have the E-SPLOST to maintain the millage rate [as is],” Lyons said.
District 3 board member Kim Cobb said she voted for the resolution because Paulding residents – especially property owners – should be able to directly decide if they want to pay a sales tax to help fund the schools budget.
“The school system is largely funded through property taxes. Rather than have homeowners carry all of the burden, I think they should have the opportunity to vote whether to allow those who shop in Paulding help to offset some of the cost of education expenses through a sales tax,” Cobb said.
“A sales tax affects everyone who chooses to shop in Paulding rather than [placing] everything on the average homeowner,” she said.
The main reason for continuing the sales tax “is to relieve homeowners from paying bond indebtedness through their property tax bill,” she said.
“The current school board has not voted to raise the property tax millage rate but rather to allow SPLOST revenue to decrease required bond interest debt,” Cobb said.