My understanding of the property tax swap is that it would phase out levy equalization and yet, wealthier districts would STILL be subsidizing poorer ones. I am all for equity but when every single district in this state is cash-strapped, it seems unfair.
Read on and tell me your thoughts.
The Property Tax Swap (or "State & Local Property Tax Shift" as it is more technically known) is also the only one of four levy reform options to be dismissed as "Not Recommended" in the final 2011 report of the state's Levy and Local Effort Assistance Technical Working Group.
The idea is simple, though the execution is not. The state would increase the state property tax levy (which is technically a school levy) while reducing the cap on what school districts can raise via their local levy. Statewide, these two shifts would offset each other, meaning no net change in either total revenue raised or K-12 dollars spent. It is essentially an effort to achieve greater equity between rich and poor districts by shifting funding from local levies to the state.
But due to wildly different property values between districts (for example, Bellevue has $2.7 million in assessed property value per student compared to only $0.3 million per student in Yakima), this shift would impact different taxpayers differently. Homeowners in property rich districts like ours would see their total school levy bill rise (for example, by 22 percent in Bellevue), as would those in districts that currently raise little or no local school levy. But homeowners in some property poor districts could see their school levy rates slashed—by 31 percent, for example, in Pasco.
While a hold harmless protects districts from losing total funding, typically the growth rates of hold harmless funding have been flat, compared to the historical growth allowed under the M&O levy authority calculation.
Several urban and suburban districts would experience lower revenue growth rates and a property tax increase. This would likely increase the tension among districts regarding differences in total per-pupil funding.