Why does wealthy DougCo need more money for schools?

Aerial drone image of Castle Rock, COGetty Images

By: Suzie Glassman/Newsbreak Denver

(Castle Rock, CO) Douglas County School District Superintendent Erin Kane recently presented the school board with a plan to put a bond/mill levy override on the November ballot to ask voters for more money.

Citing a desperate need for additional funding to raise salaries for teachers and staff, hire more personnel, and cover capital expenses related to building and maintenance, Kane wants DougCo residents to know the county’s prosperity doesn’t equal more funding for students.

Last year, Kiplinger, a publisher of business forecasts and personal finance advice, ranked Douglas County fifth among the 10 “real” richest counties in the United States.

The report noted Douglas County’s median home values are more than double the U.S. and a third higher than Colorado’s median.

So, why does the district need a property tax increase with all that property wealth?

Why property tax wealth doesn’t mean more funding for DougCo schools

“The more a county raises locally, the less money the state provides in per-pupil funding,” explains Leslie Colwell, vice president, K-12 Education Initiatives at Colorado Children’s Campaign.

The school finance act set up this policy to make up for differences in local property wealth. Districts with more wealth get less state aid, while those with less get more state money.

A combination of state and local funding makes up the district budget

Colorado has a fixed amount of money it provides to districts per pupil. In 2021, that number was $7,083.61.

The state then factors additional per-pupil funding based on the cost of living, district size, number of at-risk students, and online and ASCENT students. This number is then multiplied by the budget stabilization factor.

The budget stabilization factor, approved in 2010 during the economic downturn, reduces the amount of state funding to schools. The impact on DougCo amounted to nearly $84 million in lost revenue for the 2020-2021 school year.

DougCo’s per-pupil revenue from the state for this school year was $8,607. Additional money added from the 2018 mill levy override, plus a few other sources, added $2,226.

Amount of combined state, local and federal school funding comparison:

• Douglas County with 67,305 students - $855,927,915 (53% local, 44% state, 3% federal)
• Denver with 92,413 students - $1,588,184,216 (72% local, 21% state, 7% federal)
• Jefferson County with 84,078 students - $1,111,689,096 (55% local, 39% state, 6% federal)
• Cherry Creek with 56,228 students - $782,035,465 (50% local, 46% state, 4% federal)

Willingness to vote for increased property taxes

Why are the percentages of state and local aid so different? “It’s confusing,” says Colwell. “Counties have different tax rates. And state law prohibits any tax increase without a vote of the people.”

The only other way a school district can add to its general fund, 85 percent of which goes to pay salaries, benefits, and pensions, is to ask taxpayers to approve a property tax increase through a mill levy override (MLO).

MLOs like the one DougCo voters approved in 2018 are not considered by the state when deciding the amount of per-pupil funding each district receives.

That money can only be used for operating expenses, like salaries and benefits.

Before 2018, DougCo voters hadn’t approved an MLO since 2006. This long gap in raising property tax rates for education meant that while the cost of living increased substantially, the school district didn’t keep up by increasing teacher and staff compensation.

The 2018 MLO added $40 million to the operations budget. The district earmarked $17 million for compensation adjustments.

DougCO teachers and staff still make less on average than surrounding districts

The average teacher salary in Douglas County is close to $58,000, while teachers in Denver, Littleton, Jefferson County, and Cherry Creek average $3,000 to $18,000 more annually.

The national average teacher salary is $65,090. Colorado ranks 25th in the nation for average teacher compensation and 48th for starting teacher salaries.

In her presentation to the school board, Kane said support staff makes less per hour than employees at many surrounding businesses, including Target, Chick-Fil-A, and Amazon.

Will DougCo voters approve an MLO in November?

Colwell says she believes support for higher taxes in a county signals that voters trust the school board.

“It will be interesting to see if some of the recent conflicts in the district come into play should an MLO come up for election,” says Colwell.

The Douglas County school board formed a Mill Bond Exploratory Committee (MBEC) earlier this year to determine “both ongoing operational and capital needs, and to assess the feasibility of a successful Mill Levy Override (MLO) and/or Bond issue on the November 2022 ballot.

MBEC meets every Wednesday from 6 to 8:30 p.m. at the DCSD Administration Building (620 Wilcox Street, 3rd Floor Board Room, Castle Rock) unless otherwise noted.