January 31, 2024
Sen. Lou Ann Linehan, Chairperson
Sen. Joni Albrecht
Sen. Eliot Bostar
Sen. George Dungan
Sen. Kathleen Kauth
Sen. Fred Meyer
Sen. Dave Murman
Sen. R. Brad von Gillern
Chairperson Linehan and Members of the Revenue Committee,
Lincoln Public School District submits this testimony in opposition to LB 1316. LB 1316 fundamentally changes the school finance package crafted by Governor Pillen and advanced by this legislature last spring in LB 583 (Foundation Aid and Special Education Reimbursement), LB 589 (a new soft property tax request cap preserving local control) and establishment of the Education Future Fund. Striking the local school board’s authority to increase the base growth percentage will have catastrophic implications and will erode our state’s public school system. The 2023 school finance package included multiple variables and implementation will not be fully realized until 2025-2026 when the increase in special education funding is included in the state aid calculations.
Most importantly, 2023 was not the full implementation year for the property tax request cap; the cap certified did not include the additional special education revenue anticipated for the 2023- 2024 school year. The property tax request cap certified to school districts this summer for 2024-2025 budget development will include the additional special education revenue. Consequently, you must understand that striking this provision this year will result in a less than 3% cap on many school districts. The calculation will take last year’s numbers plus the 3% growth minus the additional special education revenue.
LB 583 provided additional revenue to school districts through foundation aid and an increase in state funding to reimburse special education expenditures for the 2023-2024 budget year. The additional revenue represented a shift to state funding, casting out a vision to our communities of expected property tax relief. Many districts dropped their levies; the LPS board dropped the levy 14 cents. Two factors were driving forces in the levy reduction – the additional special education reimbursement from the state and an unprecedented increase in valuation.
Districts with large portions of residential property experienced sizeable valuation increases last year, an additional factor that is imperative to consider and understand. In this circumstance, school districts do not have the luxury of planning incrementally year over year. We must plan over multiple years. In Lancaster County, residential property is reassessed on a rotating basis. In the year that valuation increases, the district has higher state aid, and the following year, the state aid drops, and the valuation doesn’t grow much at all. We expect our state aid to drop in excess of $30 million dollars for the 2024-2025 school year. The only way to manage such extreme swings in revenue is multi-year planning.
We cannot address school finance in a piecemeal fashion. Every change has impacts with known consequences impacting our ability to effectively serve children across the state.
Sincerely,
Liz Standish MBA, EdD
Associate Superintendent for Business Affairs
lstandis@lps.org
402-436-1636
