[0:57] then we do have a quorum so I will call this meeting to order um the board and uh School District would like to welcome [1:03] any and all guests here tonight we have a number of student presenters which is always a highlight of our meetings [1:09] tonight is the last regular board meeting of the 2023 calendar year which means our agenda is quite full with [1:16] several time-sensitive items one of the key tenants in our strategic plan is to explore multiple perspectives practice [1:23] civil discourse encourage empathy create interpersonal connections and embrace [1:28] diverse identities as a board we wanted to share this with our guests in the hope that as adults we [1:34] model for the students of this District what civil discourse and embracing multiple perspective looks like this [1:40] shared understanding will enable us all to complete the important business of the district for the benefit of all our [1:45] students thank [1:53] you y I would like to propose a motion to [1:59] our agenda tonight um because we have so many things on the agenda um and that includes Our Truth and Taxation audit [2:06] review I propose that we limit the community comment to 30 minutes pursuant with policy [2:12] 206 if all speakers help us out and adhere to our three-minute rule we will be able to have nine speakers and then [2:20] any commun Community member who would like to share something with the board but is unable to because of time [2:25] capacity tonight we invite them to email the board and I can assure you that all of us read all of our emails that we [2:32] receive therefore I would like to um make the motion is there a second second all [2:40] those in favor of approving the motion say I I I anyone opposed the motion is [2:45] passed um we're now going to move on to approval of our agenda for the night um do I have a motion to approve the agenda [2:51] for tonight's meeting so moved do I have a second second we will now vote to approve tonight's agenda all those in [2:57] favor say I I anyone opposed the agenda is approved Dr Stanley will [3:02] you please review tonight's agenda with us absolutely as director green said we have a full agenda tonight um we have [3:10] our truth in taxation public hearing um that we'll go into recess for in just a moment we'll have hearing from members [3:17] of the public uh several con consent agenda items we have information about [3:22] our audit uh for finances and we'll be taking a look into um the budget [3:29] forecast t for future years coming out our legislative action committee including several of our students are [3:35] here to speak this evening um we are going to go over secondary course uh [3:40] approvals um we heard that at work session last time and they're bringing this for discussion we have several [3:47] policies that are coming forward um and then when we move into action we have the certification of our property taxes [3:54] we have several policies that are coming up for final action uh and then of [3:59] course we we have um leadership and committee updates and my updates thank [4:04] you chair thank you Dr Stanley next on our agenda is our excellence and action portion and tonight we have three [4:11] outstanding board members who have served the board for multiple years and this is their last board meeting they're [4:17] rolling off the board so I would like to take a moment to recognize um board director Julie green who's our vice [4:23] chair of Regina Neville oh there you are thank you um and also um Janie Shaw and [4:30] thank them for their contributions to the board um their years of service um [4:35] to the students of our um the District of Edina and I would like us all to give them a round of applause and thank them [4:42] very [4:50] much thank you everyone we are now going to move the board into recess for a truth and Taxation hearing um the board [4:57] is now on recess and I'd like to invite invite up um Mt [5:03] Woodard director [5:21] Woodard just waiting for our PowerPoint there we go good evening [5:27] chair allenberg members of the school board super Stanley um enthusiastic members of the public with us tonight to [5:33] hear about taxes great to see a good crowd for this topic um tonight represents a very unique time in the [5:39] school district calendar where we are looking at three separate fiscal years in great detail as Cher alberg mentioned [5:45] earlier we'll have our fiscal year 2023 audit results presented later um we're obviously operating the 2024 fiscal year [5:51] and later tonight the school board will actually approve about 35% of next year's budget um in terms of [5:58] revenues tonight's hearing will allow the school district to fulfill several of its um [6:03] obligations as a taxing Authority um the first of which is to hold a public hearing between the dates of November 25th and December 28th the meeting must [6:11] be held after 6 pm. the second is a presentation of our current year budget as well as taxes payable in [6:17] 2024 and also allowing for a period of public comment the public comment specific to taxes payable in [6:26] 2024 our hearing agenda follows directly from the statutory requirements again um some brief background about school [6:32] funding a brief overview of the district's property taxes payable in 2024 a very brief overview of the [6:38] district's current budget and again that opportunity for members um taxpaying residents of the district to address the [6:43] school board specific to property [6:49] taxes before we get into the actual taxes it's super important to take this opportunity to mention that um State [6:55] funding is extremely regulated not only the funds that flow directly from the state but also Alo local property taxes [7:00] all of the revenue formulas and various authorities are written into [7:05] statute um the vast majority is based on student enrollment um so as your enrollment Grows All us being equal your [7:12] funding will also grow and vice versa if you begin to decline an enrollment your revenues will also decline um the state [7:19] does allow school districts to generate additional Authority above and beyond what it receives from the state um via [7:25] voter approved levies operating referendums Capal projects levies and school building bonds um however the [7:30] state also caps what we can generate in terms of operating referenda and capital projects levies um so while eana does uh [7:38] benefit from an extremely robust tax base um we have caps on what we can generate from our local tax [7:46] base the basic general education formula is the primary funding source for all school districts in ID it's about 44% of [7:53] our total revenues which is actually quite low when you compare to surrounding districts who may be in the 55 to 60% rate range um for fiscal year [8:01] 24 the state appropriated an additional 4% above and beyond the $ [8:06] 6863 that we received in fiscal year 23 um for fiscal year 25 we're receiving an [8:11] additional 2% above that 4% for this year um while those are healthy increases over the last 20 years as [8:18] you'll notice on the next slide um State funding has lagged behind inflation in fact it's lagged um quite dramatically [8:25] um so much so that the state did actually appropriate um additional f for fiscal years 26 and Beyond the funding [8:31] formula will now be tied to inflation with a minimum of 2% added each year and a maximum of [8:38] 3% I like showing this slide at most of my finance presentations there you can see the gap between um what the state [8:45] has appropriated over the last 20 years and what actual inflation has been the difference is about $1,400 per pupil [8:53] unit um translate that to 's enrollment and you're looking at about $18 million of additional funding um so over time [9:00] school funding will not meet inflation although the state has given us that 3% cap for fiscal years 26 through 29 um [9:07] there are doubts whether or not um that will be enough to sustain our [9:15] funding I'll briefly review our fiscal year 2024 budget which is the current fiscal Year's budget um this is [9:21] different to some of the city or county presentations you'll be seeing this month where those folks will be [9:26] approving their current budget as of January 1st their fiscal year start with the calendar year whereas our starts on [9:32] July 1st um the school district is required by the governmental Accounting Standards Board and state statute to account for [9:39] both revenues and expenditures in the various funds that you see displayed on the screen right now um the vast [9:45] majority of our funding about 154.000 million in revenues and 149.5 in [9:51] expenditures lie in the general fund that's the kind of the backbone and the guts of the school district um this [9:56] funds our regular instructions special education instruction Transportation Administration um utilities and [10:03] liability insurance among um many other categories of expenditures so that's about 75% of the [10:10] district's budget the Food Service fund accounts for the meal sered to students on a daily basis both breakfast lunch [10:16] and allart items and the corresponding Revenue that comes from the state federal and local um [10:23] students the community service fund is a fee for service fund which houses many of our um excellent before and after [10:30] school program such as kids club Wise Guys Youth and Adult Enrichment Early Childhood family education and many [10:36] other programs our building construction fund is used to collect the proceeds of bonds [10:42] and pay as you go Levy Authority and that's offset by the expenditures that are used to um build buildings and um [10:49] complete deferred maintenance projects that Fund in particular you'll notice um has a great excess of expenditures over [10:54] revenues uh that's simply a timing mechanism we receive funds in one one year and in subsequent fiscal year we [11:00] will spend those proceeds until projects are completed so that's completely normal finally we have our internal [11:07] service fund which is used to collect the premiums uh paid by employees for their dental insurance and also the [11:13] district's contribution and that's offset by the premium and administration fees that go out to the [11:22] carrier the following slide is a breakdown of our general fund by General um sources um as I said earlier about 30 [11:29] 5% of our funding comes from local property taxes which is quite High most districts are in the 15 to 25% range um [11:37] so we're quite reliant on our local um tax base to create additional revenues we're very grateful for [11:45] that again that uh the remaining portion is from State AIDS 44% of that from the general education formula and the rest [11:51] from our special education and other funding formulas for about 60% of our [11:57] revenues a further breakdown of our general fund revenues by actual Revenue specific Authority as I said earlier [12:04] about 43 to 44% from the basic education Aid and then our special education Aid [12:10] makes up the remaining bulk of our state AIDS operating referendum local optional [12:15] Revenue the technology Levy and other levies combined for that 35% that I mentioned [12:26] earlier on the expenditure Side Of The Ledger you see a breakdown of expenditures by type or as we like to [12:31] say in Minnesota by object so these are very specific expenditures such as salary computer devices um pens pencils [12:38] fuel anything you might imagine a school district um would pay for um it's no surprise that staff compensation [12:44] actually makes up about 79% of all of our expenditures that's the combination of the actual salaries as well as [12:50] benefits health benefits Social Security contributions so on and so forth so about 80 80% any changes to this [12:57] category would obviously have a significant impact on the school district's Financial [13:06] Outlook a different breakdown of the district's general fund expenditures is by program type um these programs are [13:12] categorized as um Elementary and secondary regular instruction special education instruction those two [13:18] categories combine for about 62% of all expenditures which is um expected um the [13:23] remaining categories such as sites buildings um vocational education instructional support make up the [13:29] remaining portion of our expenditures you'll note that Administration and District support make up only about 4% [13:35] and so this district is doing a great job of maintaining enough services at the central office to run the district [13:40] um but no [13:48] more that brings us to our proposed property taxes payable in 20124 um so [13:54] those receipts will begin in May of 24 which will fund the subsequent fiscal year so fiscal year 2025 Revenue um [14:01] overall we're seeing a $3.6 million increase to our property tax levy or about [14:07] 5.26% that's a slight reduction um from last year's 9% so while we are adding uh [14:12] money to the general fund it is a lower increase than the prior year and we'll get into some of the reasons as to why [14:19] that is on subsequent slides three million of the increases in the general fund and will support [14:25] ongoing operations um in our classrooms um the community service fund and Debt Service fund also see some modest [14:36] increases a detailed breakdown of all 31 Revenue categories um which require about 5,000 different formulas from the [14:42] state um is provided in your board packet I won't get into all those today I will touch on the four major increases [14:49] though the first of which is our operating referendum um that's one of the mechanisms school districts have to [14:56] um create additional Revenue above and beyond what the state State supplies so that's about $20 million in our budget [15:02] um we're receiving about $2,197 per pupil unit um which is a [15:07] 5.37% increase from the prior fiscal year we're also seeing a 14% or $1 [15:13] million increase to our capital projects Levy that funding source is used to to support um technology throughout the [15:19] district be it's staff student devices staff devices and infrastructure purchases that Levy is the only Levy [15:27] category that's actually tied to our tax base so as our tax base increases that Levy category will increase in direct [15:34] proportion our other poose employment benefits is seeing a massive increase from the prior fiscal year this is a [15:41] timing issue um there were some expenditures that were not recorded at the time of Levy certification last year [15:47] um those have been recorded and adjusted for in the subsequent year so we'll receive the money that we should have [15:52] received on our pay 23 Levy and pay 24 um these Levy categories are always adjusted up to two years following [15:59] certification so there will always be a number of adjustments when we certify our levies and finally our long-term [16:06] facilities maintenance this is used to fund uh building deferred maintenance projects throughout the district be it [16:11] um building envelope roofing systems mechanical systems boilers Electric electrical units Etc um that's seeing a [16:18] plan 10% [16:23] increase next is a graphical representation of our Levy history over the last 10 years as well as our [16:30] enrollment you'll notice right in the middle of the page there in 2021 there was a a massive decrease in enrollment [16:37] um that's due to the covid-19 pandemic uh most school districts in the state of Minnesota and across this the country [16:42] saw a similar decline um however not all have rebounded in the way that we have um we've got very stable enrollment at [16:49] this moment so we're glad to have rebounded to actually be Beyond pre-pandemic [16:54] levels over the last 10 years our Levy has increased by about 6.4% on average [17:00] and Over The Last 5 Years about 5.1% so the 5.26% increase that we'll see for [17:06] property taxes payable in 2024 is right in that range so nothing out of the [17:13] ordinary the following slide is a representation of our um tax base and how that's grown over the last um 10 [17:20] Levy Cycles um over the last 10 years our property tax both on a referendum [17:26] market value basis and net tax capacity basis has increased by an average of about 6% year-over-year [17:32] um that's important because as properties grow the uh that mitigates the impact on taxpayers so if all else [17:40] is equal and the property tax base is improving um you'll get a lower slice of [17:46] the pie so to speak of the tax P um of course in reality we know that assessed values will also increase however the [17:53] tax impact is still lesser than it otherwise would have been so it's important to note um that our tax base is growing and robust and that's a a [17:59] benefit to all taxpayers in the [18:07] district several factors can affect the ultimate property tax bill of a taxpayer those include changes to their [18:13] individual property um changes to all other property valuations within the district and also changes to the levies [18:20] assessed by the various taxing authorities upon the properties so in this District we have um of course our [18:26] school district property taxes city viina property taxes the henpen County property taxes and there are also some [18:33] other special taxing jurisdictions as well um in the past uh the state of [18:39] Minnesota used something called a mill rate and we've um since deviated from that structure that's basically if the [18:45] school district's taxes went up 5.26% your own property taxes would also go up [18:50] 5.26% um many tax uh payers still believe we use this system um however [18:56] it's been a very long time since we have and it's important to to note [19:03] that the following slides will be an example of how property taxes actually affect a homeowner um the examples [19:11] include both flat um property value so uh the house in one year will be the [19:17] same in all future years and another example is an 18.3% cumulative growth over four years [19:24] and we'll kind of examine the different um scenarios so the first scenario is no no [19:30] change in property value excuse me you'll see on the chart that in all [19:36] of the various property classifications and values um taxes actually go down on [19:41] that that value that property value um if the property value stay the [19:46] same in all of the years again uh in reality property values are always increasing however if a home was worth [19:52] say um that $750,000 um in one year and is $750,000 [19:58] in the the next year that homeowner would see a corresponding decrease to their school-based property [20:08] taxes again over the last four Levy Cycles the example again is the same no change in property value um the home [20:15] with a $600,000 property value and a home with a $750,000 property value would see [20:22] decreases to their school-based property taxes [20:29] same example applies to commercial values um of about a million dollars and also residential [20:36] values now for the more interesting example um a home with changing property values which is more realistic again the [20:43] 18.3 cumulative change over four years um the property taxes as you can see on [20:49] those particular Parcels is increasing over time um however the the increases are quite modest again those are [20:55] mitigated by the overall increase to our property base [21:04] at this point we fulfilled all of our statutory obligations in our truth and Taxation hearing and it is now time for [21:09] a period of public [21:16] comment if members of the public that are residents of Edina have a question about any of the tax information you're [21:22] welcome to ask a question we have a microphone and you can raise your hand [21:35] um there's no opportunity for that not regarding our children no we're not allowed to ask about our children no and [21:41] you're out of order so I'm GNA have to ask you to be quiet um are there any questions about the truth and [21:48] Taxation are you in president ofo I am yep can I [21:57] yep [22:04] hi my name's Eva hajan I live at 5608 St Andrews Avenue about three blocks away from [22:10] here um okay to be fair I don't have any questions about taxes I'm going to have to Ru you out of [22:18] order if you don't stop talking we're gonna have to take a recess so I need you to stop talking or we're going to [22:23] have to stop the meeting we're going to have to take a recess okay [22:29] we're going to take a 10 minute recess thank [22:56] you [42:24] second so move second second all those in favor say hi anyone oppose agre the [42:31] motion cares and we are thank [42:55] you