Kings Schools Receive Over 1 Million Dollars from City of Lebanon
The District has been recently made aware of an independent review of the City of Lebanon’s Tax Increment Financing (TIF) program. Over the past 20 years, the City of Lebanon has successfully utilized Tax Increment Financing incentives as an economic development tool to attract new businesses to Lebanon’s Industrial Parks. The City’s TIF program directly finances public infrastructure improvements undertaken by the City of Lebanon. Some of that infrastructure lies within the Kings School District.
As part of the TIF program, incentivized businesses are required to make direct annual payments to the City in lieu of property taxes. After the City’s annual expenses for the infrastructure are accounted for, the City redistributes part of the remaining TIF funds to either the Kings Local School District or the Lebanon School District depending on the location of the incentivized business and terms of the various TIF agreements.
The City of Lebanon recently completed an extensive independent third-party review of the TIF program to ensure that the school district payments were being allocated properly. This review identified that both school districts had been inadvertently underpaid. In this case, the Kings Local School District had been underpaid $1.555 million, over this 20-year time period. The underpayments were largely the result of changing tax values over this period, as well as different rates and charges impacting property tax payments. These funds currently reside in the City’s separate Tax Increment Financing Fund cash reserves, and the City is taking steps to distribute this money to each school district.
The City recently met with Kings Superintendent, Tim Ackermann, and Treasurer, Cary Furniss to report the findings of the independent review, and provide notification of plans to distribute the money owed to the District. Treasurer Furniss said, “The challenges of applying Ohio school finance to these agreements is difficult and the commitment to getting it right is to be commended.” The one-time funding of the $1.555 million will help the District offset the cost associated with an increasing student enrollment. “The District is gained capped and the current school funding formula does not provide dollars for nearly 1,200 of our students,” he said. Additionally, this money will help ensure the District makes the 2016 operating levy last longer than the 3 years promised at the time of its passage.
The Kings Local School District appreciates the leadership of the officials at the City of Lebanon for taking the initiative to audit the compensation agreements for the TIF properties with our District.