Arcadia school board approves nearly 50% drop to mill rate with 2023-24 budget

Taxpayers within the Arcadia School District boundaries will see the mill rate on their tax bills cut nearly in half after Arcadia’s school board unanimously approved its 2023-24 budget last Monday.

A unanimous 7-0 vote last Monday locks in a mill rate of $5.51 for this year, a cut from last year’s $10.70 mill rate.

The decrease was made possible by the 2023-25 state biennial budget that vastly increased state aid for public schools by giving an additional $325 in aid per student. 

In Arcadia that means approximately an additional $1.6 million in aid for the next two years, decreasing the amount residents pay through taxes.

“It not only helped us from a budget standpoint but because of that one-time investment the state put in in what amounts to property tax relief with the $325 revenue limit bump, we didn’t have to pass that revenue bump onto taxpayers either, which allows us to keep that mill rate (low),” Arcadia superintendent Lance Bagstad told the Times.

A lower mill rate from the school does not guarantee a lower total tax bill, though, because other tax authorities and home values play a part in figuring such bills.

A number of “efficiency pieces” in this year’s district budget helped lessen the mill rate, including a savings of about $350,000 in teacher pay due to retirements and new teachers making lower salaries as well as less money being spent on administrative salaries by not hiring a dean of students.

Other savings include a $111,000 cut to the IT budget and an additional $270,000 from halting health savings accounts for employees. 

The board also approved 6.3% pay increases for most staff and 5% increases for administrators with the budget’s approval.

“These are one-time cuts, which is why I kept reminding the board that this might be your chance to do a raise for people because these cuts aren’t going to be there next year,” Bagstad said. “We can’t expect to see $350,000 difference in salaries from this year to next year.”

The biennial budget relief helped Arcadia, but long term money could be one challenge for whoever replaces Bagstad as superintendent next year.

“We really tried to make sure we could do a lot of things this year, one being the raises we were able to do but another thing is making sure our programming is still there for the kids this year,” Bagstad said. “Moving forward it’s going to be even sharper pencils and bigger erasers. But I’m not sure there’s much left to erase.”

About $435,975 in ESSER III funding will be granted to the district this year from the COVID pandemic, but most of this money is earmarked “for different salaries to deal with achievement gap reduction type things, learning loss, mental health,” Bagstad said.

There is between $5,000-8,000 unallocated, which will likely be used on curricular materials and has to be spent by September 2024.

With the mill rate approval, the owner of a $100,000 home in Arcadia will pay $551 in school district taxes this year. 

The total tax levy for the district spread between its 11 municipalities is about $3.18 million for this year, a drop from last year’s $5.7 million.

“I think we put forth a very fiscally responsible budget,” Bagstad said.

“We’re operating in a surplus in the moment. … the overall budget that was approved that matches our district improvement plan of being fiscally responsible, I think it takes care of teachers and staff in giving them a good living wage increase. Yeah, we had some cuts in some areas, but I look at those as finding efficiencies rather than decreasing programming.”