A tax-rate hike intended to offset a decline in property values produced something the Beaufort County School District didn't expect: a $3 million windfall in its 2014 budget.
The money won't be pocketed, however. Board of Education Chairman Bill Evans asked County Council Chairman Paul Sommerville in a letter Sept. 4 to lower the school district tax rate before property tax bills are issued in late October or early November.
The council's Finance Committee voted unanimously Monday to recommend the lowered rate to council, which approved the measure on the first of three required readings later that night.
The council has called a special meeting for 5 p.m. Monday to conduct a second reading.
That would allow a final public hearing and vote on the rate change Sept. 23.
"We need to shoehorn this in and get three meetings in three weeks, but that's worth doing for the taxpayers to get savings," Finance Committee Chairman Stu Rodman said. "I wouldn't expect any discussion (about approving the change) because the school board requested it."
The amount of a property tax bill is determined by applying the tax rate, or millage, to the assessed value of the property. Whether a property is a commercial property, primary residence or secondary home also affects the amount of the bill.
County Council is trying to quicken the pace of approval because the county Auditor's Office needs the adjusted rate by the end of September to issue property tax bills on time, Rodman said.
County Council and the Board of Education have tussled over school funding during recent years, but Evans said the board doesn't want a budget increase to come as a result of a miscalculation.
"Sure, we could find plenty of ways to spend that money, but you know that's not why I am here," Evans said at the meeting. "We fully expect and support a decrease (in the tax rate) that council will approve."
In June, County Council set the district's tax rate at 100.55 mills, appropriating slightly more than $121 million in local tax revenue. The school board received a millage rate estimate in March from the county to allow it to calculate its budget. The tax rate estimate was to be revenue-neutral, to offset lower property values expected from a countywide reassessment this year.
However, when the district's budget figures were recalculated after reassessment was completed in August, the school board discovered the district would receive more money than expected, Evans said.
The board is asking County Council to lower the tax rate by 3.1 mills to 97.45 mills.
Evans said the district could have put the money to good use -- an expansion of early-childhood education and funding to offset the loss of federal money for low-income students, for example. But such programs need consistent long-term funding, not a one-time infusion, Evans said.
"Hopefully this is a way to build trust with citizens and the community," schools superintendent Jeffrey Moss said. "We want them to know we are not looking for any additional revenue than we didn't already budget for."
The roughly $121 million in tax revenue accounts for most of the district's $182.9 million budget for the fiscal year that started July 1, said Phyllis White, district chief operational services officer. That budget included about a $4.9 million increase from the previous year to address the need for more teachers as countywide enrollment continues to grow.
In his request to modify the tax rate, Evans asked that the school board be allowed to adjust the rate again if it does not receive the expected $121 million in tax revenue.
"I'm sure in the future we will need to come to you and ask for a little bit more," Evans said, "so I hope that door is always open."
Follow reporter Sarah Bowman on Twitter at twitter.com/IPBG_Sarah.