In the first of three mandated public hearings regarding the 2023 proposed budget, members of the Lumpkin County Board of Education thoroughly defended their budget, despite seemingly no negative outcry from anyone attending the meeting, citing nation-wide inflation as the primary reason for the potential tax increase.
The July 28 public hearing saw 10 members of the public initial the sign in sheet at the door as well as Board of Education members Jim McClure, Mera Turner and Lynn Sylvester all in attendance. Of those attending, city councilman Johnny Ariemma was the only one to address the board on the budget.
“When you look at the millage history, you’re not out of line,” Ariemma said. “It stands on its own so I certainly don’t have a problem with that….You’ve got a tough job….Folks are hurting. When you look at the price of gas, the price of goods, food, clothing, we know that story. So I guess I would just ask y’all if there’s a way that you could ease the pain for a lot of these folks here in this community, we’d certainly appreciate it.”
The board announced at its July meeting that they would move forward with a millage rate of 14.71, representing a millage decrease from the previous millage rate of 15.56. Despite the board acting to accept the rollback rate thus lowering the millage rate, citizen’s tax bills are still expected to be higher than last year due to inflationary growth in the digest.
Superintendent Rob Brown said that inflation is solely responsible for the tax increase.
“The increase in what you’re looking at from a property owner perspective, and I certainly feel that as well, but that is completely, 100 percent due to inflationary growth,” Brown said. “So your property value of your home, if you’re experiencing a property increase, it’s because the value of your property went up….Your property values are going up, because properties in Lumpkin County are selling at much higher prices than ever before. That’s all well and good unless you’re not planning on selling.”
ONLINE ACCUSATIONS
The board also clarified that while the public may see large capital projects, such as the building of a new elementary school, that the money used for those projects is in no way related to the property tax collected by the school system, but is instead funded through ESPLOST, which comes from a one percent sales tax enforced throughout the county, which the county voted in favor of.
“I saw several comments on social media [saying] ‘our taxes are going up because of the new school.” And that’s a very visible piece of property, so anybody riding up and down the bypass can see that building and say ‘that’s where my taxes are going’ and like Dr. Brown said, that has nothing to do with it,” McClure said. “That is a separate money fund that [comes from] the ESPLOST one percent sales tax, so that one penny. But that’s not a new tax, we’ve had that in this county for probably close to 30 years. Since 1997, we’ve had that one percent sales tax. That one percent sales tax funds this building. It paid for the high school. It paid for Blackburn, It’s paid for every building that we’ve got and it’s paying for the new one over there.”
Brown added that ESPLOST money can’t be used in other ways.
“We are not permitted by law to use ESPLOST money for our general fund,” he said. “We can’t pay teachers and staff. That is unlawful for us to use the ESPLOST money. So it is not an either or, where if we didn’t build a school or we didn’t improve our facilities, we could be using that money for these costs in our general fund. That’s not permissible by law. That’s specifically for capital improvements.”
Sylvester brought up the school board’s fund balance history, which is low enough to require the school system to often times borrow money to make payroll near the beginning of the school year while they await the tax revenues.
“I think it’s important also to note our fund balance, what it has been and that we’ve always had to borrow money at the beginning of every school year in order to pay our teachers,” she said.
Brown explained the reasoning of the board.
“We will probably issue a TAN [Tax Anticipation Note] again this year, we’re hoping that next year we won’t,” he said. “Quite frankly, when I came to serve in Lumpkin County, I was a little bit uncomfortable with the fund balance or the lack thereof if you will…but that’s the conservatism of this board. They don’t want to build up a large savings account or fund balance on the taxpayers’ backs. It has been very affordable for us to get a Tax Anticipation Note which is a short-term loan so that we can ensure that our employees get paid…and so we have to borrow money in the fall just on the cycle of property taxes while they’re being collected.”
Brown said that state auditors recommend having a fund balance of 15 percent of the annual budget. When asked about the board's current fund balance, Brown said the Lumpkin school system fund balance is projected to sit just under 13 percent.
"Our projected total budget of $53,138,201 would leave an estimated $6,865,407 in fund balance," Brown told The Nugget. "This is a 12.9 percent fund balance which covers two months of payroll. State auditors recommend school systems keep a 15 percent fund balance."
McClure added more input on the idea.
“We have made a conscious choice not to tax our citizens to have enough money to make it through the payroll from the time school starts until local tax revenues come in, usually around Christmas,” he said “…Our county has been very slow about getting the tax bills out, which hurts us, makes it longer before we have that money coming in.”
COVERAGE CRITICISM
McClure took time during the hearing to compare the school board’s proposed budget situation with that of the Lumpkin County Board of Commissioners and the governments of other counties.
“I own a business in Hall County and they just announced they’re doing a 15 percent increase and I think the [Lumpkin] County government just announced they’re doing a 20 percent tax increase, so I hope everybody that’s in this room is gonna go to the county’s budget meeting because they’ve almost doubled the percentage tax increase as what the school board has,” he said.
He also directed criticism toward the reporting of The Dahlonega Nugget.
“It’s easy when The Nugget says ‘Oh, we’re having this [11.4] percent tax, well if inflation has been running nine to 10 percent, we’re back to a one percent or so over what inflation is running. We can’t ask people to work for free,” McClure said.
The portion McClure referenced citing the 11.4 percent tax increase was not from any story reported by The Nugget, but rather the legally required advertisement that the school system submitted to the paper. Brown and McClure also passed on complaints following the hearing that the advertisement seen in The Nugget, while accurate, was printed too large.
During the hearing, McClure later doubled-down on his criticism of The Nugget’s reporting, accusing The Nugget of unfairly reporting the county and school board budgets.
“I don’t think The Nugget has been fair to us because the county has been sitting here with a 24, 25 percent fund balance and I’m talking about $20 million just sitting in the bank,” McClure said. “And then now, they’re saying ‘well we want to keep that $20 million sitting there and we’re going to raise our taxes 20 percent where we’ve not been doing that. I think we’ve been making better decisions and if you read The Nugget, you don’t know anything about that.”
The county made known its plans to use $1 million in fund balance to help cover rising budget costs during a July budget meeting.
McClure continued.
“The county commissioners were even calling the full rollup rate, they were saying that was not even a tax increase and that was printed in The Nugget,” he said.
The quote McClure referenced was from the July 13 story in The Nugget titled “County faces $1.9 million budget crunch,” where The Nugget quoted Board of Commissioner Chairman Chris Dockery as saying “We would recognize the inflationary growth in the digest, I think we have to take the rollup, which is technically not a tax increase but everybody pays more” during a July public meeting. After the closing of the meeting, McClure alleged that it was unfair reporting, allowing the chairman to tell what McClure called “bald-faced lies,” without refuting them.
“If somebody is telling an untruth I think the paper should call them on it and I think the paper should be reporting all the facts,” he said.
In the story McClure references, the article states in the first sentence that tax payers will likely pay more in their tax bill.
Following McClure’s critiques, a public attendee of the meeting, Mark Cromer, also offered pointed words for the reporter and The Nugget.
“I think those of us who have lived here for a while understand what you’re saying, Jim,” Cromer said. “We read The Nugget and we are friends with a lot of you guys and it doesn’t make any sense, buddy.”
When asked for comment on McClure’s statements during the meeting, Dockery provided a statement.
“...Maybe it was taken out of context, what I truly meant to say was the county was not entertaining a millage rate increase,” Dockery said. “Just like inflation has hit every household in the county, the state and the nation, it’s hit the local government as well. So we’re having to come up with creative ways to be able to fund the local government at the same level of services that we have in the past….As your property values go up, the amount of tax that you pay also goes up as well and so from that perspective, you will see an increase in your tax bill, but that increase is not the direct result of a millage rate increase set by the board of commissioners. If there is any misinterpretation, it’s certainly my fault…and I’ll take full responsibility of that….If I offended anybody on the Board of Education, Mr. McClure or anyone else or spoke out of turn, I will certainly own that and apologize. It was not the intent to misrepresent anything that the county is doing or how the local government is funded.”
Dockery also addressed the fund balance situation on the county’s side, in response to McClure’s claims.
“Even recognizing that inflationary growth in our tax digest, the county is using some of our unassigned fund balance to balance this year’s budget,” Dockery said. “That’s not recommended that local governments do that, but we feel as if our fund balance is healthy, so we can afford to do that for one year and we do that willingly because we anticipate some real growth in our digest as we see development along the 400 Corridor….We think that things are really looking a lot brighter in Lumpkin County and we’re excited about the future.”
No members of the public, outside of The Nugget, attended the second hearing, held later the same day. Board members attending the hearing once again were Turner and McClure, with board member Craig Poore also in attendance after missing the first hearing earlier that day. School board chairman Bobby Self did not attend either hearing.