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Washington Senate proposal would limit school levy claims, as Spokane County voters consider several measures that would raise taxes

UPDATED: Wed., Feb. 3, 2021

Voters line up to deposit their ballots into a drop box at the Spokane Library South Hill branch in October 2020.  (DAN PELLE/THE SPOKESMAN-REVIEW)
Voters line up to deposit their ballots into a drop box at the Spokane Library South Hill branch in October 2020. (DAN PELLE/THE SPOKESMAN-REVIEW)

A group of state lawmakers wants to limit the pitches school districts can make to voters for more taxpayer money, as many Spokane County schools seek higher rates through levies on the ballot this spring.

Most of the school districts in Spokane County seeking levy changes on Tuesday’s special elections ballot emphasize that property owners will merely extend an existing tax by voting in favor.

But that extension, in almost every instance, will lead to higher property tax payments in 2022 and beyond. A bill under consideration in the state Senate would prevent districts from using language that has been common in messaging about the levies from school districts themselves, specifically the terms “replacement levy,” “not a new tax” or “same rate.”

“It’s not that school districts are trying to do anything improper, but there’s a lack of standardization,” said Sen. Perry Dozier, R-Waitsburg, in a hearing about the proposal held Monday.

The bill would only limit what districts could say in official newsletters and emails. Political campaign committees could still provide arguments for or against a levy using such language.

A vote in favor of eight levies being proposed by districts across Spokane County will lead to property owners paying higher rates next year than what is estimated to be collected in 2021. Districts are asking for additional dollars for what they term essential services, things that aren’t paid for with a portion of property taxes that go to state coffers and must be used for people and services defined in state law.

Riverside, Medical Lake, Great Northern, Freeman, Deer Park and West Valley are asking for their levy rates to remain the same, based on estimates of collection this year. That doesn’t mean those living in those districts won’t see a tax increase, based on fluctuating property values.

Property owners also pay a state schools levy. That tax rate is the same for every property owner in Spokane County, regardless of what school district their home or business lies within.

The levy sought by Spokane Public Schools and others is what’s known as an “enrichment” levy in state law, and the uses of that money are also prescribed by the Legislature. As district communications have noted, that includes money to pay additional nurses, staff teaching certain early, special and extracurricular education, and upper-level instructors to ease class sizes.

Representatives of the Washington Education Association, the union representing teachers statewide, and the Washington State School Directors Association, representing school board members, said the bill would limit their ability to communicate a complicated funding equation to the public.

“It would severely limit the district’s ability to inform their citizens of the facts about a levy,” said Lucinda Young, chief lobbyist for the Washington Education Association.

“We do not agree that using current terms misinforms voters,” she added.

She and Marissa Rathbone, director of government relations for the School Directors Association, said the legislation appeared to be a fix in search of a problem that doesn’t exist.

“If there is evidence that districts are misleading voters, we would really like to know about it,” Rathbone said in testimony. “If there is, we’d really like to work on a bill to solve that problem, without reducing ballot information provided to the voter.”

Districts are limited under Washington law from preparing communication “for the purpose of influencing the outcome of a school district election.” The Washington Public Disclosure Commission is responsible for policing such language, and its guidance to school districts includes endorsing districts’ ability to inform “the community of the needs the district faces and needs students have that the community may not realize exist.”

The amount sought by Spokane Public Schools for its enrichment levy is $65.7 million next year, up from the $38 million authorized for collection this year. The district says such an increase is needed to support activities that might face hardship if they were to depend only on state funds to maintain, and bring back some services – including dedicated librarians – that were lost in recent rounds of budgeting. The change requires taxes to increase year-to-year, even though the levy is a replacement for one that’s expiring and may not be considered “new” because it’s still covering expenses that had previously been paid for by the enrichment levy.

Central Valley is asking for $29.2 million next year, up from the $27.6 million authorized for collection this year. Mead is asking for $16.5 million next year, up from the $10.5 million enrichment levy authorized for collection this year.

Under state law, school districts are allowed to request enrichment levies up to $2.50 per $1,000 of assessed value, or $2,500 per full-time student, whichever is lower. Larger districts have higher thresholds.

Because property values fluctuate, any guess at a rate is just that – an estimation. The Liberty School District headquartered in Spangle asked voters to approve $1.3 million for its excise levy in 2021, estimating that would cost property owners $1.50 per $1,000 of assessed value. When the Spokane County Assessor’s Office ran the numbers for this year to reach that $1.3 million figure, however, it required a rate of $1.86 per $1,000 of assessed value.

It’s that discrepancy, and the associated messaging based on expected rates, that gives assessor’s statewide heartburn. A state association of elected assessors voted last week to endorse the Senate proposal on district language.

“The fact that they do these with a fixed rate, to me, is wrong,” Spokane County Assessor Tom Konis said. “There really is no real knowledge about how much money they’re going to receive; it makes it so much more complicated.”

As part of a major revamping of school funding driven by a Washington State Supreme Court decision, state school taxes were increased starting in 2018 while local school taxes generally declined.

The change allows districts to make the argument that, even if a higher enrichment levy rate is approved, taxpayers will pay less in local school taxes than they were four or five years ago, before the state reformed the way “basic education” services were funded. At the time, state lawmakers argued taxes would fall because of a new cap on local enrichment levy rates. Increasing those rates allows taxes to continue to creep toward, and potentially surpass, the total amount property owners will pay for schools when the state levies are factored in. That becomes more likely as property values continue to rise.

The other side of the equation in determining tax rates is the value of a property, which in Spokane County continues to climb as more people buy homes in a crowded real estate market with historically low interest rates on borrowing to pay for that property, Konis said.

As an example, the median value of a single-family home in Spokane County was $177,490 in 2017, adjusting for inflation. In 2020, the median value of a single-family home was $226,000, an increase of more than 21% over three years. Rates for local school levies could fall in that situation, Konis said, but it depends on the estimates made by districts.

Konis said the question he’s getting most in his office is about the need to pay taxes if school buildings are closed, not about the amount they would pay.

The bill’s cosponsors include local Republicans Sen. Shelly Short, of Addy, and Sen. Mark Schoesler, of Ritzville.

Editor’s note: This story has been updated to reflect the passage of a supplemental levy by voters in the Central Valley School District in February 2020 for collection this year. 

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