A taxing problem (CORRECTED)

Yukon Progress, Yukon Review, Yukon Public Schools
Jason Simeroth, Yukon School District Superintendent

By Mindy Ragan Wood
Staff Writer

Editor’s note: An error in Wednesday’s edition did not reflect that the Yukon Board of Education voted to join a proposed lawsuit during the Monday night meeting. 

The Yukon Board of Education is considering entering a proposed lawsuit against the Oklahoma Tax Commission, Superintendent Jason Simeroth said Monday night.

“One of the things that we talked about that I’ve shared with you,” Simeroth told school board members. “In meeting with other districts is to have a process…they say friendly lawsuit but I guess it’s never friendly. We are discussing it to ask them to put it off to do a lot more research to see if we were fairly represented, if we had due process.”

The OTC overpaid some districts and underpaid others after a new law changed the way motor vehicle taxes are appropriated to school districts. Several schools who were short changed sued the OTC in 2016 and a judge agreed that the agency misinterpreted the new law. In December 2018, the OTC informed districts it would deduct the difference in state funding for the next 13 months. Yukon was overpaid $633,618.75.

Overpaid districts are not targeting underpaid schools.

“It is the contention of many districts (but) we don’t want to fight against any districts but we want to protect our own interests,” Simeroth said.

Now schools who are being forced to pay back the money intend to sue the OTC, including Jenks Public Schools which voted last week to prepare for a lawsuit. As many as 10 districts in Tulsa and Oklahoma City intend to file, the Tulsa World reported last Friday.

Simeroth, who did not discuss the matter in the last two meetings, assured board members that the district is prepared to absorb the loss.

“We are able to shoulder this loss,” Simeroth said, “without anyone losing their job, programs…without any real problems.”

Adding to the financial loss was the drop in state funding for the district during the mid-term allocation period in January. Chief Financial Officer Jim Fenrick said the average school lost $30 per student, but Yukon lost $100.51 per student.

“It was quite a ding,” he said, “but not all bad. The district’s revenue increased for local sources such as ad valorem taxes and school land earnings. The revenue, called chargeable income, however is deducted from the initial state funding amount. Yukon was scheduled to receive $48 million due to the increasing number of students this year, but the stated deducted $22.5 million due to the $23.9 million in income the district collected.

“So, we net out at state aid, we get $26,116,838,” Fenrick said.

The loss was largely made up by the income received locally. The net loss in state aid after adjustments to the district was $32,197.

Fenrick said he budgeted for the reversal of funds projected by the OTC error in the mid-year figures, but that the money would likely be repaid eventually.

“Our state aid has suffered because we gained in motor vehicle (tax),” Fenrick said. “In theory, even if we lose this case, over time we would get it back because they’ll take it from the motor vehicle chargeable and we’ll get more state aid.”

Simeroth pointed out that the district was in a good position with the amount of money it carried over from the previous fiscal year’s budgets. He said his staff had done “such a fantastic job over the last five years” that the district is able to shoulder the loss.

“For all those people who ask, ‘why don’t you spend the carryover.’ Well, this is why. Because we just don’t know,” Simeroth said. “We don’t want to put our district in a bind, ever.”