Creating a budget is a process. You start with various assumptions and as you get better information, you make changes. In the end, a budget is your best projection based on the information you have a the time.
The above report shows where the District over the past few years started the process with the preliminary budget. It also shows the changes through the Proposed Final and Final approved budget.
The District, by law, has to approve a balanced Preliminary Budget early in the process. Since the District is missing a lot of the data necessary to complete the budget, the only way to balance the budget is through increasing the millage. As more information about revenue comes in and as expenses get cut the millage decreases. The District is limited as to how much they can raise taxes, despite what many people think. They are limited to an index rate set by the State. There are some exceptions that can cause the tax increase to go above the index, but they must be applied for proactively and the District does not have to use them. They are also limited.
One unintended consequence (or maybe not so unintended) of the State regulations, if a District does not increase taxes to the maximum allowed, they lose those dollars forever. The system actually encourages Districts to increase taxes to the maximum permitted.
Remember, a budget is a process. It will be interesting to see how this budget progresses over the next couple of months.
Next: County Re-balancing
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