NECC’s Levy Expected to Remain Flat Before Funding Change

NECC’s Levy Expected to Remain Flat Before Funding Change
September 18th, 2023 | Northeast Community College

NORFOLK, Neb. — Sometimes it is best to take a wait-and-see approach.  

That was the sentiment of the Northeast Community College Board of Governors during its meeting Thursday afternoon regarding the next fiscal year budget and the projected Northeast Community College levy for the 2023-24 fiscal year. While the board discussed the budget, it took no action.

Julie Robinson, chairperson of the Northeast Community College Board of Governors, said the board wants to be responsive to taxpayer perspectives and has thus scheduled another meeting for Sept. 26.  

“We must balance the needs of the college with taxpayer feedback,” she said.  

Last year, Northeast Community College’s property tax asking included a modest increase. In each of the prior three years, however, the total property tax asking decreased from the prior year. This equates to a 1.39% total increase over the last four years, which is significantly less than the rate of inflation. 

If the budget presented on Thursday holds, property taxpayers in the 20-county service area will again pay 7.25 cents per $100 of valuation to support the college in the 2023-24 budget. The college’s portion of a taxpayer’s total property tax varies in each county, but generally only represents about 5% of the overall property tax bill.  

With the projected overall property tax valuation increase of 9.26% in the 20-county service area, Northeast’s property tax asking will be such that it landed on “the pink postcard.” For those who may need a reminder, the pink postcard refers to the entities that exceeded last year’s property tax request by 2%, plus the percentage of real valuation growth.

Northeast President Leah Barrett said it is important to keep in mind several factors. First, the college has lowered the levy the past two years and requested fewer dollars in its property tax asking in three out of the past four years.  

Prior to last year, Northeast had not asked for more property tax dollars than the previous year since the 2018-19 fiscal year.  Even with an increase in tax asking for this year, Northeast’s property tax asking will only average 2.14% annually over the past five years.  

Barrett said that Northeast has a history of being good stewards of its resources and will continue to do so. Some recent needs at the college have required the property tax asking to increase in the coming budget. 

·         Growth in enrollment in recent years. Northeast’s enrollment rebounded from the pandemic to reach record enrollment.  

·         Taking care of employees. Northeast is competing with employers in a tight job market and caring for employees is one of the strategic priorities with improvements to compensation and benefit packages and systems.   

·         Technology improvements, not just keeping up with new industry standards, but ensuring the safety and security of college data.  

·         The property tax asking includes capital improvements, such as buildings. The college has chosen not to finance new construction with debt financing methods. Therefore, funds must be saved ahead of time for new construction which currently includes replacing the 53-year-old Maclay Building and the expansion of the drafting facilities.  

“I know that last year there seemed to be some sentiment among taxpayers that being on the postcard meant the government entity was a free spender. I can only speak for Northeast, and that is certainly not the case here,” she said. 

Furthermore, as additional relief to property taxpayers, 100% of the property tax paid to support the community college can be rebated as part of an individual or family’s income tax filing. This begins in the 2023 income tax filing year and will continue in successive years.

Northeast will participate in the joint meeting of entities for Madison County, which will be held on Sept. 21. The Northeast board will act on its levy and approve its budget at a separate Board of Governors meeting on Sept. 26.  

Scott Gray, vice president of Administrative Services and general counsel, said while Northeast’s valuation in the 20 counties went up 9.26%, the real growth or new growth is only .8% — less than 1%.  

Gray presented a preliminary budget to board members with various revenue and expenditure projections last month and again Thursday.  

The governors asked several questions. Governor Dirk Petersen of Norfolk said it is worth noting that Northeast is a small portion of the overall property tax that everyone pays. Keeping that in mind, a $317,000 home would result in about a $15 increase in the property tax bill for Northeast based on average valuation increases with a flat levy as proposed.

Governor Jeanne Reigle of Madison and other governors said property taxpayers will be able to get the taxes they pay for community colleges back under the new legislation when they file next year.

Governor Terry Nelson of West Point said the future is uncertain. Who knows if sometime down the road, property taxes again won’t be used to fund community colleges? he asked.

Robinson and other governors noted that they have been good stewards in the past, but several needs have made it necessary to increase this year. Instead of increasing the property tax asking in the past gradually, governors said they lowered it three of the past four years. While there is a larger increase now, the average increase over the past five years, including this year, has been about 2%.

Gray said to meet the needs of enrollment growth, market-based compensation and benefits, and technology improvements, the college will require a property tax asking of about $35.3 million in the next fiscal year budget. “This is based on the board members keeping the levy at 7.25 cents,” he said. 


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