District 88 officials: Mold means levy hike

Health and safety issues cannot

be delayed

By KURT NESBITT

Journal Staff Writer

NEW ULM -- Ongoing mold issues in three of New Ulm's public school buildings will require a big hike in the district's annual tax levy, District 88 officials said Thursday night.

Discussion about the tax hike took center stage as District 88 held the Truth-In-Taxation meeting required by state law.

The district is proposing a $1.77 million levy increase because of the costs of the mold and mildew removal in three of the school district's buildings and replacement of the heating and ventilation systems in Jefferson and Washington elementary schools, the high school and the administrative annex.

Fewer than a dozen residents attended the meeting. Only three people asked questions of the school board members

The district's 2004-05 budget, as it currently stands, is at a little over $21 million. It represents sharp reductions in spending on capital projects and the fiduciary fund, with modest cuts to the general, food services and community service funds and modest increases in spending on debt retirement and the German Land Trust Special fund.

Upcoming budget revision will include increases in income and spending for debt retirement for alternative facility bonding as work on the district's heating, ventilation and air conditioning project continues.

Peter Schaefer, rural New Ulm resident from Nicollet County, said he's worked in school districts before and has worked with all levels of government. He questioned a tax statement showing a 35 percent increase for his property taxes, noting a 7-7.5 percent increase across the state because of the state budget situation. He said he was specifically wondering about the portion about the mold, because the school levy is greatest increase in other local levies.

Business Manager Donna Luhring said the costs will be spread out over 10 years and 20 years. The district is not allowed to spread out health and safety, but a settlement in the lawsuit could reduce the levy amount at a later date.

Remme said mediation sessions between the district and the various contractors involved in the district's civil lawsuit over the 1997 building additions affected by the mold may yield a tentative settlement

Luhring said the mold problems are driving the increase. She noted that New Ulm's property values are up, which also increases taxes, because sales of homes are increasing.

Edna Rogiers, of New Ulm, questioned the lawsuit. She asked the board if there is any history of how many lawsuits have been filed and how many them have been successful.

Remme replied that he didn't know the answer, but he said the district's case is scheduled for trial in April of 2005.

School Board Chair Sue Ullery added that a lot of the mold problems stem from the 1997 additions onto those buildings.

Luhring explained that part of the problem lay in the vapor barriers, which is why the district is looking to install a central air system. The piping the contractors installed is also a problem, she said.

Rogiers asked why the tax levy increase couldn't wait. Luhring replied that the mold and mildew pose a safety issue and couldn't wait for correction.

Pat Fluegge of New Ulm questioned whether or not the mold couldn't' have been taken care of before the problem was so bad. He said he's also concerned about the rise in property tax values, since he paid $40,000 for his house when he built it 25 years ago and now it is valued at $90,000.

"This is ridiculous with the tax thing," he said. "I think the spending could also be reduced and still have a good school."

Superintendent Harold Remme replied that the district took action on the mold as soon as it was aware of the problems. He said that District 88 is a "big school system" that employs over 300 people. The district has made budget cuts in the past and will continue to make them in the future. He told Fluegge that the Brown County assessor determined the value of a home, not the school district.

Fluegge went back to the podium and asked Remme, " This is a tax meeting, isn't it? Why can't I mention it?"

"You can mention it, but I can't fix it," Remme replied.

Other factors in the proposed levy for fiscal year 2004 are $685,000 for dealing with the mold in a 10-year bond. In fiscal year 2005, $7.8 million was included for installation of a new heating and ventilation system in a 20-year bond.

No other comments were made during the tax hearing. The board will adopt its final levy on Dec. 16.

During the regular meeting, the board voted unanimously to authorize individual procurement cards to its maintenance staff, curriculum director and business staff. The policies that will set spending limits and the guidelines on where the cards will be used are slated for a future meeting, Luhring said. She said the district adopted the program to reduce the costs of paying bills and to take advantage of rebates.

"It allows us to pay just one bill instead of many," she said.