HomeMy WebLinkAboutItem B: Youth/School-Based Services Local Option Levy
ECC
UGENE ITY OUNCIL
AIS
GENDA TEM UMMARY
Work Session: Youth/School-Based Services Local Option Levy
Meeting Date: June 26, 2006 Agenda Item Number: B
Department: Library, Recreation and Cultural Services Staff Contact: Renee Grube
www.eugene-or.gov Contact Telephone Number: 682-5067
ISSUE STATEMENT
The purpose of the work session is to solicit council direction on future youth/school-based services
local option tax levies.
BACKGROUND
Council Action History
On November 7, 2000, Eugene voters passed Ballot Measure 20-37, a two-year, $3.5 million local
option tax levy, to fund youth activities. The levy expired on June 30, 2003.
On August 12, 2002, the council directed the City Manager to place a local option levy measure on the
November ballot for youth and school based services. On November 5, 2002, Eugene voters passed
Ballot Measure 20-67, a four-year, $0.86/$1,000-of-assessed-value local option levy expected to raise
approximately $8.0 million per year under the general government $10 tax rate limit. Of this amount,
7% was to be retained by the City to directly provide youth services and the remainder split between the
4J and Bethel school districts, based upon their relative share of assessed value within the city of Eugene
(83% to 4J and 17% to Bethel) to provide five categories of services historically supported by the City.
To date, the levy has raised an average of $7.6 million per year (net of discounts and delinquencies), and
would be expected to raise a net amount of $8.5 million in FY07 if the current litigation were resolved in
the City’s favor (see “Litigation History” below). This levy will expire June 30, 2007.
On November 16, 2005, the council held a work session on sequencing of financial measures to be
presented to the voters. The council approved a tentative election schedule that included presenting a
Youth/School-Based Services Local Option Levy renewal to the voters in November 2006.
In May 2006, both the Budget Committee and council discussed the policy issue of funding ongoing
services with limited-term local option levy revenue. Both bodies expressed a desire to fund core
ongoing activities from within the General Fund, rather than through renewable serial levies. The
citizen members of the Budget Committee will be meeting in the summer of 2006 to discuss the
formation of subcommittees to develop a metric for Human/Social Services in the community and to
review City basic services accessibility. Although the scope and outcome of the work of these
subcommittees is unknown at this time, the outcome will likely be a factor in future discussions
regarding youth services.
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Litigation History
The current levy has been challenged in Tax Court in the Urhausen v. City of Eugene case, where the
petitioners asserted that the portion of the levy used to fund youth services provided by 4J and Bethel
(93% of levy) should be counted as part of the Measure 5 tax rate limit of $5 per $1,000 of assessed
value for schools rather than as part of the general government $10 tax rate limit. On February 16, 2006,
the Tax Court agreed with the petitioners that Measure 5 requires the 93% to be counted toward the $5
limit. The court directed the City to refund the excess collected under the $10 limit to the three
petitioners and to categorize the portion of the FY07 levy used by the 4J and Bethel districts under the
$5 tax rate limit for schools.
According to analysis by the Assessor’s Office, if the 93% portion of the current year tax levy had been
levied in accordance with the Tax Court ruling, 4J would have lost approximately $2.5 million and
Bethel about $0.2 million to Measure 5 compression. Because 4J has its own local option levy under the
$5 education limit, they would have lost an additional $1.6 million due to compression on their local
option levy. The 7% portion of the local option levy (used by the City to directly fund youth services) is
not affected by this ruling. The chart below sets out the estimated revenues before and after the Tax
Court ruling for the current tax year.
Gross Levy Before Gross Levy After Amount Lost to
Court Decision Court Decision Compression
4J – City Levy $6.4 million $3.9 million $2.5 million
Bethel – City Levy $1.3 million $1.1 million $0.2 million
City’s portion – City Levy $0.6 million $0.6 million --
Total – City Levy $8.3 million $5.6 million $2.7 million
4J Local Option Levy* $11.1 million $9.4 million $1.6 million
Source: Lane County A&T
*Amount shown before court decision is the gross levy less compression, prior to the Urhausen decision.
In April, the City filed an appeal with the Oregon Supreme Court. At the same time, the City asked the
court to establish an expedited process to review the case. The Supreme Court agreed to the expedited
appeal. The reason for the expedited review request was to attempt to have the Supreme Court make a
final ruling on this case prior to certifying taxes for FY07. The oral arguments are scheduled for June
19, 2006, under the expedited schedule, which would give the court more than two months in which to
issue a decision (if favorable) in a time frame that could preserve the entire levy for FY07. This is the
latest that the City could receive a ruling and certify the FY07 taxes prior to the September 1 extended
certification deadline. The Supreme Court’s acceptance of the expedited schedule does not guarantee,
however, that the court will rule within that time frame.
As a result of the uncertainty from the legal challenge to this levy, the FY07 budget included a
contingent categorization of this tax. In the event that the Supreme Court overturns the Tax Court
ruling, the City will certify the levy under the $10 general government tax rate limit. If the Supreme
Court has not ruled by September 1, or if the Supreme Court upholds the Tax Court ruling, the City will
categorize the levy in accordance with the Tax Court ruling.
Current Services
Youth services currently provided directly by the City include prevention-based programs, such as the
Fun For All program, RecZone After-School Programs, Youth Leadership and Community Service
Opportunities, Summer Swim and Water Polo League, and special neighborhood events. In addition,
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the City provides several programs through limited-term grant funding, such as Project Rising
Expectations, After-School and Community Education, Bethel and Churchill Teen Courts, and the Afro-
Academic Cultural, Technological and Scientific Olympics (ACT-SO). These services, which total
approximately $1.3 million per year, are funded with a combination of $600,000 from the current year
levy, grant funding, and carry forward of levy funding from previous years. Details about these services
currently paid for with levy and grant funds are included in Attachment A.
Staff estimates there is sufficient funding under the current levy to continue planned services through the
summer of 2007, but no funding available to continue through the end of FY08. In addition to the
programs funded through the levy and limited-term grants, the Budget Committee added programs on a
limited-term basis in the FY07 budget for youth programs. These programs included the Boys and Girls
Club and Safe & Sound Youth Services, totaling $305,000 per year.
Services provided from the City’s local option levy funds through the school districts include elementary
physical education and music, counselors, librarians and nurses at all levels, and secondary
extracurricular activities such as sports programs. Both the 4J and Bethel school districts have indicated
that, given current financial assumptions, they have developed alternative strategies (primarily use of
reserves) to fund these important programs through the next biennium without the City’s local option
levy funding. Both districts received additional state funding and more property tax revenue than
anticipated under their permanent tax rates. In addition, 4J has its own local option levy under the $5
school limit, and that levy has provided more funding than originally projected.
The Bethel School District asked voters for approval of a local option levy to fund additional math
teachers, more computers and more textbooks in the May 16 election. The measure received a majority
vote, but the voter turnout did not meet the double-majority requirements of Measure 50, so the measure
failed. District officials are considering whether to ask voters for a levy again in November, but no
decision has been made yet.
Options for the City’s Youth Local Option Levy
Option 1 - Renew Current Levy:
If the levy was renewed at the current rate ($0.86/$1,000) and
the Urhausen decision was overturned, it would cost the typical taxpayer about $126 per year. Based on
a strategy discussed with the school districts, the City of Eugene would receive 15% to implement youth
services and the remainder would be split between the school districts based upon student membership.
This strategy was intended to increase the City’s share of the levy, as well as keep the school districts
close to the same funding level as under the current levy. The strategy had been discussed with the
school districts last year, prior to the Urhausen decision. Staff projects the following revenues for each
entity under this approach:
Estimated Revenue from Renewal of Current Levy
($ in millions)
FY08 FY09 FY10 FY11 Total
4J $5.7 $5.9 $6.2 $ 6.6 $24.5
Bethel $1.9 $2.0 $2.1 $ 2.2 $ 8.2
City of Eugene – 15% $1.3 $1.4 $1.5 $ 1.5 $ 5.8
Total $8.9 $9.3 $9.8 $10.3 $38.5
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Because this levy is currently being challenged in the courts, if voters were to approve the measure, the
City might not be able to levy the schools portion of the tax in the event that the Supreme Court upholds
the Tax Court ruling. Voters might also be confused about the City’s intention in placing such a
measure on the ballot during a time when the courts are reviewing the levy. Additionally, if the Bethel
school district places a local option levy on the ballot in November, the City might not want to have a
competing measure.
Option 2 -Develop Smaller Levy for City Services Only:
The City could propose a smaller levy
to voters that would fund only those programs provided directly by the City and/or through other youth
service partners with the current levy funds, and would add levy funding for programs currently funded
with limited-term grant funding and for some of the high priority services identified in the Parks,
Recreation, and Open Space (PROS) project and priority plan. The types of services added could
include programs such as a water safety program and after-school programs at elementary schools.
Attachment A includes a description of potential services that are identified as high priority services in
the PROS project and priority plan. Such a levy would raise approximately $2.4 million per year and
would cost taxpayers $0.24 per $1,000 of assessed value, or about $35 per year for the typical taxpayer.
This approach would reduce tax bills by $0.62 per $1,000 of assessed value, or about $91 for the typical
taxpayer.
Option 3 -Incorporate City Youth Services into the General Fund without Levy Renewal:
The
City could provide its core youth services from within the General Fund without asking voters for
renewal of a local option levy. This approach would be consistent with the discussion that both the
Budget Committee and council had around the library local option levy. This approach would reduce
tax bills by $0.86 per $1,000 of assessed value, or about $126 for the typical taxpayer.
In this case, the City would have to absorb some or all of the $1.3 million of existing youth services into
the General Fund by FY08, in addition to absorbing some or all of the library services that will not be
funded with local option levy proceeds during FY08 through FY11. Service levels for the youth
programs, the library programs and all other General Fund programs would be prioritized during the
FY08 budget process. If all else remains constant, this approach will require either a new on-going
revenue source or reductions in expenditures in order to accommodate additional core youth services
and provide structural balance in the General Fund over time.
November Election
Passage of a property tax measure on a general election ballot in an even-numbered year requires a
simple majority of the votes cast. A double majority is required in any other election.
The following items have been placed on the November 2006 ballot:
? PROS (Parks, Recreation and Open Space) bond measure
? Library local option levy renewal
? Lane Community College local option levy
Additionally, there are other items that may be placed on the November 2006 ballot:
? Lane County income tax proposal
? Bethel School District local option levy
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In order to place a measure on the November 7 general election ballot, the council must act by July 26 to
start the voters’ pamphlet process.
RELATED CITY POLICIES
City of Eugene Financial Management Goals and Policies
Policy C.3 – Serial tax levies
“To the maximum extent possible, serial tax levies will be used only for time-limited operating
services or for capital improvements subject to the rate limitation for non-school governments.”
Policy C.6 – Non-recurring revenue
“Except for local option levies approved by the voters, the City will use non-recurring revenue
on limited-duration services, capital projects, equipment requirements, or services that can be
terminated without significant disruption in the community or City organization.”
COUNCIL OPTIONS
1. The council may provide direction to prepare a measure for the November ballot to renew the
youth/school-based services local option levy at $0.86/$1000 of assessed value with 15% of the levy
proceeds applied to City youth service programs and the remainder split between the 4J and Bethel
school districts.
2. The council may provide direction to prepare a measure for the November ballot to fund the City’s
youth services. This levy would have a tax rate of $0.24/$1000 of assessed value, would raise $2.4
million per year and would fund the City’s services currently included in the youth levy, services
provided from limited term grant funding, and high priority services identified in the Parks,
Recreation, and Open Space project and priority plan.
3. The council may provide direction to fund some or all of the City’s youth services programs from
within the General Fund rather than from a local option levy.
CITY MANAGER’S RECOMMENDATION
The City Manager recommends Option 3.
SUGGESTED MOTION
Move to direct the City Manager to incorporate some or all of the City’s core youth services within the
General Fund rather than through a local option levy by FY08
.
ATTACHMENTS
A. Description of City-provided Youth Services included in the Local Option Levy and High Priority
Youth Services from the PROS Project and Priority Plan
FOR MORE INFORMATION
Staff Contact: Renee Grube
Telephone: 682-5067
Staff E-Mail: Renee.L.Grube@ci.eugene.or.us
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ATTACHMENT A
Levy and Grant Funded Youth Recreation Services and
High Priority Youth Services Identified in PROS Project and Priority Plan
With funds from the City’s Youth Levy and various grants, the Recreation Services Division provides a
number of out-of-school activities throughout the community. These prevention-based programs reflect the
40 Developmental Assets’ values and concepts, with the goal of helping youth and families fully engage
with--and function in-- the world around them through healthy, fun and constructive use of time. These
core services are designed to meet the following key goals:
?
Provide neighborhood-based service delivery to minimize transportation barriers to participation.
?
Reduce financial barriers to participation by providing free or low-cost activities.
?
Prevent deviant, unhealthy behaviors.
?
Improve the level of physical activity and fitness of participants.
?
Promote cultural diversity and inclusion.
?
Provide educational assistance in school sites via homework labs.
?
Provide skills to be safe in all recreational pursuits.
?
Work in partnership with other youth services providers.
In FY06, more than 50% of the attendees in the Recreation Division’s Youth & Family Service area were in
activities and programs that were funded by the City’s portion of the Youth Levy and limited term grant
funding.
Youth Program Funding
The summary below sets out the components of the proposed youth levy described in Option 2 of the AIS:
Current Programs and Services Funded by the Youth Levy* $1,100,000
Current Programs and Services Funded by limited-term grants $ 200,000
PROS Project and Priority Services potential additions $1,100,000
Total $2,400,000
* Includes current year levy funding and prior year carry forward
Current Levy Funds
Programs funded by the City’s portion of the levy cost approximately $1.1 million annually. Services
provided with these funds include:
?
RecZone After-School Programs
provide life-enhancing recreational and educational
opportunities that engage middle school-aged youth in safe, positive and well supervised settings.
Programs occur at nine middle schools in 4J and Bethel School Districts.
Activities include: Games, Sports, and Fitness Programs; Arts, Performing Arts, Tech Labs;
Homework Assistance; Assistance to School Activity Clubs; Ropes Challenge Course Activities;
Special Events such as Dances, Field Trips, Guest Speakers, and Talent Shows; Outdoor classes
and Outings in Rock Climbing, Kayaking, Rafting, Skate Boarding, Pedal Power Bicycle Riding,
and Excursions to the Snow.
?
Youth Leadership and Community Service Opportunities
for youth aged 14-18. This program
focuses on learning how to become an outdoor leader, plus first aid and CPR training. Towards the
end of the program staff work on finding summer employment and take youth on a five day outdoor
trip. Volunteer credit and elective credit are available for this program depending on the school.
?
“Fun for All”
community-wide summer program provides free and low-cost recreation
opportunities for youth ages 7 and up at summer playground park sites in eleven locations (five
with wading pools). Seven of these park locations are Food for Lane County free lunch sites. Last
summer, over 16,500 free lunches were served at these sites.
?
Summer Swim and Water Polo League
for novice swimmers, 8-14 years old. This is a low-cost
opportunity to learn the fundamentals of competitive swimming and water polo.
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?
Neighborhood and Community Special Events
such as We Are Bethel Celebration, Whiteaker
Neighborhood River Festival, “Out in the Artdoors” Urban Adventure Race, Hershey Track Meets,
and Movie Nights in the Park.
?
Contracted Services
- The Recreation Services Division also provides funding to the following
community agencies to extend and diversify services in core youth program areas: Boys & Girls
Club, Emerald KIDSPORTS, and Oregon Festival of American Music (now the John G. Shedd
Institute for the Arts) and the University of Oregon Youth Enrichment and Talented and Gifted
program.
Grant Funding
In addition to these levy-funded programs, a number of core youth services are funded by limited-term
grants. Revenue received from these grants totals approximately $200,000 annually. Grant-funded
programs include:
?
Project Rising Expectations (PRE) -
A partnership with Eugene School District 4J to provide
fitness and health activities in seven middle schools during after school hours. This program
includes climbing walls, non-traditional sports, nutrition courses, health awareness activities, dance
classes, and more. This grant expires in FY07.
?
After-School and Community Education (ACE) -
A partnership with Eugene School District 4J.
ACE is a 21st Century Community Learning Center Project grant for academic enrichment, family
educational development and recreation programs at three economically disadvantaged elementary
schools in Eugene: Adams, Harris and Meadowlark. The schools were selected because a majority
of their students qualify for free/reduced lunch, and an analysis of 4J Reading Diagnostic Tests
indicated the schools fall below the district median for oral reading fluency. In addition, the
percentage of disadvantaged students who did not meet the standards in English/Language Arts is
quite high. The ACE Project funding is intended to close the "achievement gap" at those sites. This
grant ends in FY11.
?
Bethel and Churchill Teen Courts
- Teen Court is a program run by teen peers who are
authorized by the Lane County Department of Youth Services to conduct court hearings to
recommend consequences for qualifying first-time juvenile offenders. Youths that admit guilt may
voluntarily choose this neighborhood option and earn a recommendation for record expunction.
Funding for this grant is reviewed annually.
?
Afro-Academic Cultural, Technological and Scientific Olympics (ACT-SO)
– This grant from
Lane County Department on Children and Families provides for mentoring and enrichment support
in preparation for the local ACT-SO competition. Funding for this grant is reviewed annually.
High Priority Services Identified in the PROS Plan
In addition to the core services identified above, a number of high priority recreation services and programs
were identified as part of the Parks, Recreation and Open Space Project and Priority Plan. If additional
youth and family services were to be added, some of the following programs identified in that plan would
be considered. These programs are estimated to cost an additional $1.1 million annually.
Examples of high priority youth and family services identified in the PROS Project and Priority Plan
include:
?
Increase family programs and special events throughout Eugene.
?
Expand community center hours of operation.
?
Expand after-school programs in the elementary schools.
?
Increase affordable outdoor recreation opportunities for youth and families.
?
Provide additional support for inclusion services, including volunteer and staff training.
?
Conduct a water safety/lesson program for every third grade student.
?
Develop the City’s role in providing job training and work experience for youth.
?
Expand youth mentoring program.
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