Frequently Asked Questions
Q1: How are bonds and levies approved?
A1: Both bonds and levies require voter approval, but in Washington bonds require a higher majority of voter approval than levies. Bonds require a supermajority to pass (60%). Levies require a simple majority to pass (50% + 1).
Q2: What is a levy rate?
A2: A levy rate is the amount of property tax per $1,000 of assessed property value to fund a voter approved levy amount. A levy rate of $1.00 means that for every $1,000 of property value, the owner of the property will have to pay $1.00 in taxes.
Example: If a homeowner has a home valued at $200,000 and the levy rate is $1.00 for every $1,000 of assessed property value, the homeowner will pay $200 annually in property taxes.
Q3: Why do different districts generate different amounts of levy dollars when they have the same estimated levy rate?
A3: Districts can have the same levy rate but raise very different amounts of money because the total property value within a district’s boundary varies greatly across the state. For example, a levy rate of $1.00 in a district with an average property value of $200,000 will generate $200 per household in levy funding. On the other hand, a district with a $1.00 levy rate and an average property value of $700,000 will generate $700 per household for the same level of property tax.
Q4: How often can school districts run levies?
A4: Depending on the type of levy (enrichment, capital (including tech), or transportation), voters can approve levies for one to six years. After the allotted number of years, the levy expires. Districts may then go back to their voters and ask for a continuation, or replacement levy.
Q5: Is there a limit on the dollar amount a district may propose for an enrichment levy?
A5: Yes. This maximum dollar amount is known as the “levy lid.” As part of the changes the Legislature made to the way the state funds education in Washington, also known as the “McCleary decision,” levy rates are capped at $2.50 per $1,000 of assessed property value. A levy may not collect more than $2,500 per student maximum ($3,000 per student in Seattle only), a dollar threshold which is adjusted annually based on inflation.
*NOTE: the levy lid only applies to enrichment levies, not capital or transportation levies.
Q6: Do all public schools receive state funding?
A6: Yes, but the amount that districts receive varies based on a number of factors.
For example: Enrollment, regional cost of living differences, poverty rates, and the number of special needs or non-English speaking students are all factors in the amount of state funding a district receives. Most districts also receive additional federal funding, which is mostly determined by levels of poverty and special needs populations within a district.
Q7: Didn’t Washington schools already receive money from the state because of the McCleary decision?
A7: Yes, but the funding does not cover the actual costs of operating a school district. The Washington State Supreme Court decision on the McCleary lawsuit resulted in public school districts seeing a net funding increase in 2018. Even though the state increased the amount of funding it was providing to school districts, it also capped the amount of funding school districts can raise from local levies. The Legislature also applied restrictions to how funding can be used. For local school districts, this means that levies have been significantly impacted, causing widespread confusion in communities across the state.
Q8: How is the investor “rating” of a bond determined?
A8: When a bond issue is approved by voters, the school district receives a “rating” on its financial condition. This “rating” communicates the level of risk to investors who may purchase the district’s bonds. The higher a district’s rating, the lower the risk to investors and the lower the interest rate district taxpayers will pay for that bond.
Q9: What are “state match dollars”?
A9: Many school districts can qualify for additional financial assistance from the state of Washington to help build or modernize facilities. The state determines the amount of square footage that each student needs (the amounts are different for elementary, middle, and high schools) and assigns a dollar amount per square foot based on current average construction cost estimates. Both new construction and remodeling projects can be eligible for state assistance. While these matching funds are helpful for bond projects, only a limited percentage of actual costs are typically covered using this formula, leaving the rest of the cost to the school district and the local community (via a bond or capital levy).
Q10: What are school “impact fees”?
A10: School district boards and county governments can pass policies requiring developers to pay “impact fees” on all new construction to help pay for new schools. An impact fee is a fee that is imposed by a local government on a new or proposed development project to pay for all or a portion of the costs of providing public services to the new development, such a school. Impact fees are more common in high growth areas where new homes are creating the need for additional classrooms or schools. Generally, impact fees alone will not generate enough money to build a new school.
Q11: Is there a tax break for senior citizens?
A11: Senior citizens and disabled persons may qualify for a tax exemption. More information about tax relief programs is available on the Douglas County Assessor’s website or by calling 509-745-8521.