By Christina Calloway
An oversight of the Portales Municipal Schools funds pushed the Board of Education to vote in favor of a tax increase Monday on a general obligation bond.
Portales schools Superintendent Johnnie Cain said the district’s financial advisors, RBC Capital, had a different figure for the district’s debt service than what was originally reported, about a $200,000 difference Cain said.
This caused a representative from RBC to recommend a tax increase of about 40 cents, raising the tax rate to $8, to pay off an existing bond.
Board members said they were initially under the impression that they didn’t have to raise taxes with the passing of the general obligation bond. Cain added the State Legislature grants authority to school districts to raise the tax without a public vote, but isn’t sure of what that limit is as of Monday night, only that it is “based on the percentage of bonding capacity.”
“I don’t know where the error came in,” Cain told board members.
Cain said though the increase is minimal, he didn’t want to raise taxes if the board didn’t have to but ultimately the funds approved through the $600,000 bond are tied to a technology lease purchase agreement.
“There’s no way to avoid (the tax increase) because of prior debt,” said a representative of RBC. “It’s a good thing we caught it now.”
Cain said in about two years, the schools’ financial advisors projected for the tax rate to go down, eventually reaching $7 in four years.
“It was something we didn’t want to do but we wanted to keep the technology bond,” Cain said.