DANVILLE — With Danville School District 118 officials now anticipating less of a decrease in the area’s equalized assessed valuation than originally expected, the school board Wednesday will consider a slight increase in tax rate that still could result in homeowners paying less taxes to the district.

District 118 Business Director Heather McKiernan said Vermilion County Supervisor of Assessments Matt Long now estimates a decrease in the school district’s equalized assessed valuation of 5.42 percent for 2012, rather than 9 percent as previously projected.

McKiernan explained that last year the state added a 4.11 percent multiplier on the area to temporarily decrease the value of the area’s properties. That temporary multiplier has expired.

Without the 4.11 percent multiplier, the area’s equalized assessed valuation still is expected to decrease 5.42 percent, which means a total loss in tax revenue to the school district of $325,314, but is better than the original projected loss of $795,984 had the equalized assessed valuation declined 9 percent.

With the new information, McKiernan said she is recommending the school board levy for a 0 percent increase/decrease, which will negate the district’s risk of losing money if there is less of a decrease in equalized assessed valuation than has been anticipated. The school district, therefore, will only collect tax money based on the actual equalized assessed valuation determined in the spring.

“We’re hoping the state won’t put on another multiplier,” she said. “I’m recommending a 0 percent levy, knowing we’re going to see a 5.42 percent decrease.”

On Wednesday, school board members will consider setting the 2012 tax rate at $5.19 per $100 equalized assessed valuation, which is payable in 2013 and is an increase from the current tax rate of $5.03 per $100 equalized assessed valuation.

Despite the slight increase in tax rate, homeowners will see a decrease in the amount of tax they will pay to the district due to the lower equalized assessed valuation.

With the district’s equalized assessed valuation projected to decrease by 5.42 percent, a $60,000 home could possibly decrease in value to $56,748, so even with an increase in the tax rate from $5.03 per $100 equalized assessed valuation to $5.19 per $100 equalized assessed valuation, the homeowner could see a decrease of $24.14 on his or her tax bill next year.

Two years ago, the area experienced a 4.14 percent decrease in equalized assessed valuation, which amounted to a loss of $650,759 in property tax revenue collected by the school district in 2011.

Last year, the area’s equalized assessed valuation declined 5.87 percent, which amounted to a loss of $917,678 in property tax revenue collected by the school district this year.

McKiernan said the school district has lost $2.6 million in potential property tax revenue in the last four years due the equalized assessed valuation declining 21 to 22 percent during the same time period. In addition, the state still owes the district $1.8 million in state-aid reimbursement payments.

Superintendent Mark Denman said the loss of revenue is “still a great challenge for our school district. As the EAV goes down, costs keep going up.

“We’ve had to decrease staff and cut back on supplies,” he added.

Denman said delays in state reimbursement payments to the district as well as an impending decision on pension reform “are certainly a worry to us.”

Also on Wednesday, school board members will:

• Consider authorizing the issuance of general obligation school bonds not to exceed $8.5 million for the East Park Elementary School renovation project.

“We don’t plan to go that high, because we don’t know what the interest rates will be,” McKiernan said. “But we want to give them the authority to issue the full amount.”

In April 2011, $21.5 million in bonds were issued to cover the renovations at South View and North Ridge middle schools with the understanding that a smaller bond issuance would be needed for the East Park project.

East Park, which formerly was a junior high school until the 1980s, is the third and final school to be improved in the district’s three-year renovation project. South View Middle School was renovated in 2010-2011, and work at North Ridge Middle School is on schedule with completion expected next month.

All three facilities originally were constructed as junior high schools in 1961.

The renovation projects were budgeted in such a way as to not affect the local school tax rate, but East Park is the last and the largest of the three schools to be improved, and the money that is available will dictate how much will be renovated at East Park.

Bond adviser Anne Noble of Stifel Nicolaus investment banking told board members at their Oct. 24 meeting the original plan was to fund $8.5 million for the East Park project, however, the equalized assessed valuation in the district has dropped by 18 percent in the last four years, which affects how much tax the district can levy to support the bond issuance without raising the tax rate.

This year, the owner of a home valued at $66,500 and who was taxed 58 cents per $100 equalized assessed valuation paid $93.52 toward the bond issuance for the South View and North Ridge middle schools renovations.

Next year, with the district’s equalized assessed valuation projected to decrease by 5.42 percent, the same home could possibly decrease in value to $62,895, possibly making it necessary to slightly increase the tax rate to support a bond issuance for East Park’s renovations. Even with raising the tax rate, the district still would collect less revenue for the project.

Any additional money needed for the project beyond the bond issuance would come from the district’s operational fund.

At the Oct. 10 school board meeting, Architects from Schmidt Associates of Indianapolis estimated the cost of the East Park project, without any alternates, to be between $10.75 million and $11.75 million.

By comparison, the renovation work at South View cost $12.3 million, while renovations at North Ridge cost $13.8 million.

The East Park project will be put out to bid in four packages — general contractor, electrical, plumbing and mechanical — during the first week of November, with bids being presented to the school board at its Dec. 12 meeting and contracts hopefully being awarded Dec. 13.

Renovation work could possibly start as soon as Christmas break, with the work on the existing building being substantially completed in mid-August 2013.

The base project includes installing a new roof, replacing the sidewalks around the school, grading the land around the building, replacing drainage pipes and making them larger in the courtyards, replacing the fixtures and repairing the restrooms, creating two new classrooms in a commons area that might be used as a computer lab and paving the school’s parking lot as well as the road around the school that connects to Colfax Street.

The possibility of a building a cafetorium like at South View and North Ridge has been ruled out. However, depending on how the bids come in, school board members will consider two options that could be added to the architects’ base bid.

Option 1 would entail constructing an addition to the east side of the gymnasium for a cafeteria with a seating capacity of 448 that would adjoin the existing kitchen. That alternate work is estimated to cost an additional $1.55 million to $1.65 million

Option 2 would entail the construction of a new cafeteria with a seating capacity of 448 and a new kitchen built in the large grassy area to the south of the main entrance of school. That alternate work is estimated to cost an additional $2.2 million to $2.3 million.

• Consider approving the purchase of several properties at 909 N. Jackson St., 919 N. Jackson St., 921 N. Jackson St., 1004 N. Jackson St., and 304 Sidell St.

Denman said the district purchased these properties from the county at a surplus auction last week. The four Jackson Street properties cost $600 each, while the property on Sidell Street sold for $2,600.

Denman said three of the properties have abandoned homes on them and two lots were vacant.

• Consider what to do about administrative vacancies in the 2013-14 school year. At the end of the current school year, the following administrators will retire: Dianna Kirk, associate superintendent; Mark Neil, Danville High principal; Kathy Houpt, human resources director; Diane Hampel, educational support services director; and Cheryl McIntire, Northeast Elementary Magnet School principal.
• Consider raising the pay for substitute teaching assistants to $65 a day from $60 and substitute secretaries to $75 a day from $70. The $5-per-day increase for the substitute teaching assistants would cost the district an additional $8,600 a school year. The $5-per-day increase for substitute secretaries would cost an additional $1,000 a year.

Coming Up

District 118 school board members will meet at 6:30 p.m. Wednesday in the Jackson Building, 516 N. Jackson St.