The Dorchester County Council voted to cut $4 million from Dorchester School District 2’s current operating budget at a meeting Friday morning.
The vote reflects the shortfall realized in tax revenue from rental properties, businesses, vehicle taxes and a one percent sales tax.
But council members did vote to fund the school district an additional $472,000 for the 08-09 school year, said DD2 Finance Director Allyson Duke.
A provision in state law allows the district to collect money on last year’s budget through the end of this year, Duke said. She said there was a shortfall in revenue for the 08-09 school year.
The $472,000 will come from a tax increase on local businesses and rental property owners this year, said Councilman Larry Hargett, who was the only member to vote against the measure.
He said he voted against the additional $472,000 because businesses would have to foot the bill. The final vote was 5-1 for the additional funding, with council member Kenny Waggoner absent.
“I voted against it, because it’s going to come from an additional tax on businesses and six percent assessment (tax on rental properties),” Hargett said after the meeting. “I am opposed to any tax increase.”
In 2006, the state legislature changed the way schools districts get money. Operating budgets are funded from taxes on rental properties, businesses, vehicle taxes and a one percent sales tax, Duke said. Taxes on residential homes only pay for debt services, Duke said.
In a tough economy, businesses are closing, less revenue is coming in from sales taxes and more properties are being assessed as primary residences rather than rental property, Duke said. All of these make up the district’s operating budget.
The school district’s expected tax revenue for its operating budget this year was $69 million. Revenue shortfalls now put that figure at $65 million, Duke said. The district’s total operating budget from all sources for this year is $134 million.
“A lot of things are impacting us,” Duke said. She said the district is taking a hit more with local taxes than through state taxes.
Dorchester County Council members did not take action at Friday’s meeting to make up the $4 million difference, Duke said. It would have had to come from raising taxes.
“It’s awful that any of us are in this dilemma,” said School Superintendent Joe Pye, at Friday’s meeting. “(Council members) are doing what they need to do to protect the community."
Pye said he expects an additional shortfall next year and that in order to deal with the cuts, the district will have to “definitely do something with personnel.”
Duke said it doesn’t appear likely that the shortfall will be made up from state and local revenues.
“The way the formula was (changed on how districts get money), we knew this was something that was coming,” Duke said. “We are talking with our legislators.”
 
Contact Jenny Peterson at 873-9424 ext. 216 or JPeterson@journalscene.com.