Hannibal, MO - The Hannibal School District is facing a decision regarding our operating tax levy that will be determined at the Tax Rate Hearing on Tuesday August 20, 2024. Inflation has increased significantly, while our assessed valuation and student attendance have decreased. The school board historically rolls back the operating levy when possible, providing financial savings to taxpayers. However, the cost of living has outpaced our growth in assessed valuation, reducing funding for essential school programs and services. This year, we aim to maintain a tax rate that ensures adequate funding for the quality education and support services our students need to be successful.
To collect taxes above the maximum tax ceiling, voters would have to approve any tax increases. The district is not pursuing this. The intent is to collect the amount currently allowed by the Hancock Amendment.
We are committed to providing the highest quality education for our students, maintaining fiscal responsibility, and offering clear and transparent communication on this issue. To help our community understand this issue and its impact, we have prepared a list of Frequently Asked Questions (FAQs)
Frequently Asked Questions
Question | Answer |
1.What are the current operating and debt service levy’s? | The current operating levy is set at $3.0499 The current debt service levy is set at $1.1200 Total: $4.1699 |
2. What is the difference between an operating levy and a debt service levy? | Operating levy funds are used for day-to-day District operating expenses associated with educating students; including paying staff, providing transportation, curriculum resources, paying for utilities, and maintaining the District’s buildings and grounds. Debt service levy (bond issue) funds can only be used for brick and mortar "capital" projects. These two levies serve separate and distinct purposes. There are strict state guidelines of what can be transferred from one fund to another. |
3. How is this issue separate from Proposition Innovation? | Voters of Hannibal passed the No-Tax Increase Bond Issue, Proposition Innovation, in April 2024. This passage allows HPS to (see below ballot language): Proposition Innovation Shall the Board of Education of the Hannibal School District No. 60, Missouri, without an estimated increase in the current debt service property tax levy, borrow money in the amount of Thirty Million Dollars ($30,000,000) for the purpose of providing funds to construct, equip, and furnish the Hannibal Innovation Campus; to complete Middle School and High School Auditorium renovations; to upgrade the Porter Stadium concession stand, restrooms, and bleachers for ADA compliance; to prepay existing lease financings; to the extent funds are available, complete other repairs and improvements to the existing facilities of the District; and issue general obligation bonds for payment thereof? If this proposition is approved, the adjusted debt service levy of the School District is estimated to remain unchanged at $1.1200 per one hundred dollars of assessed valuation of real and personal property. |
4. How is the operating levy set? | The Hancock Amendment, effective since 1980, limits property tax revenue for local governments and taxing jurisdictions, including school districts. Each year, school districts must set a new tax rate based on county assessments to ensure they aren’t collecting too much in property taxes. The state’s Hancock Amendment controls our tax revenue and tax rates by tying them to the Consumer Price Index (cost of living increase), which is 3.4% (determined by the MO State Tax Commission). Because assessed property values decreased by 2.5985%, we will generate less revenue unless we retain more of our available operating tax revenues. Additional Tax Rate Information: The Missouri School Operating Levy Amendment (Amendment 2) was approved on November 3, 1998. This measure allows school boards to set the operating levy up to $2.75 without a vote. Hannibal has a maximum authorized levy of $3.75, the highest operating levy that can be set without voter approval. According to the State Auditor's Office, this $3.75 maximum has been in place since 1996, when their electronic records began. This year, Piper and Sandler, the District’s Financial Advisor calculated the Hannibal School District’s FY25 operating levy ceiling at $3.4921 and the FY debt service ceiling at $1.2428, with a total levy of $4.7349. These figures have been verified with the State Auditor's office. At the August 20, 2024 tax rate hearing, the Hannibal Board of Education can set the tax rate based on either FY25 tax levy ceilings OR the maximum authorized levy ($3.75); whichever is lower. The State Auditor certifies the tax rate annually to monitor changes in the district’s assessed valuation and adjust its levy accordingly. This ensures the district's revenue remains level and consistent from year to year. In doing this, the state auditor factors in the Consumer Price Index (3.4%), new construction, and personal property. In general, if assessed valuation is growing it will push the levy downward. If we are losing assessed valuation, it will drive the levy upward but never higher than the maximum authorized levy ($3.75). To collect taxes above the maximum tax ceiling ($3.75), voters would have to vote on a Tax Increase through an election. The district is not pursuing a Tax Increase. Ensuring sufficient operating funds helps us maintain quality education and support services for our students. |
5. How does our operating levy compare to other school districts similar in student body size? | See Charts: Operating Levy for Comparable School Districts 2023-2024 |
6. What have been the benefits of previous tax rollbacks? | We are proud that previous rollbacks provided financial savings to taxpayers. However, the cost of living (Consumer Price Index) has exceeded our growth in assessed valuation, leading to reduced funding for school programs and services. This reduction directly impacts the quality of education and resources available to our students. You can see the recent history of HPS rollbacks on the chart: Historical Levies By Fund |
7. What specific programs or services are at risk if taxes are rolled back again? | Rolling back the operating levy to $3.0499 equates to an approximate $1,343,891 in uncaptured revenue. This would require budget amendments such as:
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8.How will setting the current tax rate without a rollback benefit our schools? | Maintaining the operating tax rate without a rollback will help the district fund critical areas such as teacher salaries, classroom resources, technology, and extracurricular activities, ensuring a high-quality education for all students. |
9. How will the decision to not roll back taxes impact the average taxpayer? | See Charts: Cost Table for $.3515 Levy Increase |
10. When was it first suggested to the Hannibal Board of Education to not rollback the operating levy for FY 25? | During the FY23 August tax rate hearing the board of education had much discussion regarding eliminating the rollback. This was a reassessment year and the decision made would not be able to be revisited until FY25. Ultimately the board voted to rollback the tax rate. During the FY24 August tax rate hearing, this topic was again discussed. The board was informed that the rollback must stay in place during FY24 as it was a non-reassessment year, with the understanding this must be carefully reconsidered during the FY25 tax rate hearing. On March 14th the district sent a press release titled Hannibal Public Schools Plans for Fiscal Challenges and this was covered by multiple local media outlets. In the article it specifically stated “The maximum operation tax levy approved by the voters that live in the district has been voluntarily rolled back by the BOE for many years. Based on the increase in operating costs, it is recommended that the rollback be reevaluated.” This information was also shared verbally with multiple community organizations from Superintendent Susan Johnson as she educated the community about Proposition Innovation throughout the month of March. The tax rate was also mentioned during the presentation of the Bond Sales in June 2024 and was presented in the 2024-2025 Preliminary Budget message. The Budget was approved by the Board of Education with a vote 7-0. |
11.What steps is the school taking to manage its budget efficiently? | For the upcoming school year, the district has eliminated 22 positions through resignations, retirements, and transfers. In total, we cut $2.4 million from the 2023-2024 budget. We are continually reviewing and optimizing our budget to reduce unnecessary costs and ensure that funds are directed towards student-focused programs and resources. Because declining attendance is a major factor in loss of revenues, the District is actively working on a plan to improve student attendance. School Administrators are working closely with community agencies and updating attendance policies to encourage students to attend school regularly. You can read more about how we’ve been addressing Fiscal Challenges on our website, in the News Article published Mar 14, 2024 titled Hannibal Public School Plans for Fiscal Challenges. |
12: Could we rollback this year and reevaluate next year after seeing this coming year's revenues? | No, we cannot choose to recapture next year if we roll back this year. Operating levies can only be adjusted every two years. It has been recommended by the following financial experts for the Hannibal Board of Education to not rollback the operating levy during FY25.
Ensuring stable funding now helps maintain the quality of education and support services for our students. Additionally, while the state formula is fully funded this year, there are concerns that next year we may not receive the same level of funds. If there was ever a year to consider this and prepare for FY26, it is this year. Most significantly, the state department of education requires school districts to have a minimum of 3% reserve balance in order to not be considered financially distressed. The district ended FY24 with a 4.75% reserve balance. The Hannibal Board of Education established a goal in 2015 to maintain a reserve balance between 20-25% as recommended by the state. A rollback this year would potentially cause the district to further dip into reserves and risk becoming financially distressed. |
13. How can I stay informed about this issue and others? | Stay updated by visiting our school website,(www.hannibal60.com) subscribing to our monthly newsletter (Pirate Pride E-News), and attending school board meetings (3rd Tuesday of each month). Board Meetings are also streamed on the District’s YouTube channel. |
Community members with questions are encouraged to call Central Office at 573-221-1258.
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Media Inquiries:
Contact: Andrea Campbell, Communication Specialist
573-221-1258,
acampbell@hannibal60.com
About Hannibal Public Schools: Our mission is to serve our community by helping our students thrive. With dedicated educators and staff, we strive to create a supportive and enriching environment for all our students.