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Higher property valuation growth means 'even more neutral' budget for LPS

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LPS district office

Lincoln Public Schools district office. 

Slightly higher than predicted growth in property valuation across the city will mean more revenue for Lincoln Public Schools, reduce the need to tap into cash reserves and support more investments in technology.

The tweaks to the proposed budget for the 2022-23 school year are the result of growth in property values across the district of 4.17%, an increase from the 3.4% figure officials had been working with.

That will mean about $2.2 million more in property tax revenue for the district, bringing total revenue essentially in line with the $489.9 million LPS budgeted in general fund spending this school year.

LPS proposes 5.8% increase in spending following two austere budget years

“This budget is becoming even more neutral as far as revenue and expenditures being in line with each other,” said Liz Standish, LPS associate superintendent for business affairs.

The added revenue will allow LPS to draw only a fraction of what it anticipated to take from the cash reserve, which the district uses to manage year-to-year revenue swings in property taxes and state aid. For the 2022-23 budget, LPS will take just more than $234,000 from the cash reserve, down from the $2.1 million it previously planned to use.

LPS will also increase funding of the district’s technology plan from $321,000 to more than $642,700. The funding, which will be used for purchasing student devices, makes up for cuts made in previous years.

"I think we had a plan of what we would do with the money if we had additional resources, and it was money we had to reduce from budgets in past years," said Kathy Danek, who chairs the Board of Education's finance committee. "So when the valuation comes in and you keep revenue neutral and take care of those things in the classroom, that's the most important part."

The district’s tax levy will subsequently drop about a third of a cent from previous projections to $1.222 per $100 of valuation to fund general operations, bond debt repayments and the Education Service Unit. About 60% of a Lincoln resident’s property tax bill goes to LPS, or $2,794 a year for the owner of an average $228,660 home.

Overall, the budget will grow about 5.8% from last year to account for two new schools opening, salary increases for teachers and restoring past cuts.

The budget growth comes after two leaner spending years in which the district asked departments to cut their budgets by 5% and relied on its cash reserve to balance revenue swings as state aid continued to drop.

LPS expects to field bowling, girls wrestling teams this winter

The district uses the cash reserve as an operational fund to pay expenses, such as payroll, throughout the year. It's typically at its lowest level in March — about $31 million — until the first wave of property tax revenue starts rolling in in April.

Toward the beginning of the school year, the fund is generally higher — just more than $100 million — and is depleted over the course of the year, while at the same time other sources of revenue, such as state aid, are added.

Payroll accounts for 88.5% of LPS expenditures.

Among other expenditures outlined in the budget are the addition of bowling and girls wrestling teams and onboarding costs for Standing Bear High School, which opens next fall.

The proposed budget is set to go before the Lincoln Board of Education for first reading Sept. 13

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Contact the writer at zhammack@journalstar.com or 402-473-7225. On Twitter @HammackLJS

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K-12 education reporter

Zach Hammack, a 2018 UNL graduate, has always called Lincoln home. He previously worked as a copy editor at the Journal Star and was a reporting intern in 2017. Now, he covers students, teachers and schools as the newspaper’s K-12 reporter.

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