Revenue projections give school district pause
In the face of lower numbers, officials looks at reduction in capital plan expenditures, projects; suggest reaching out to Lee County for a discussion on impact fees
The School District of Lee County is facing a large reduction in its five-year capital plan — $178.7 million — due to reductions in the capital outlay millage, sales tax, and impact fees, the main sources of funding for their capital revenue.
“This is going to have a drastic effect on what we are able to do with capital dollars. The capital committee is meeting regularly to adjust the plan,” Budget Director Kelly Letcher said, adding that they still have to have student stations and maintenance at their schools. “We are working on that plan with the hope to bring it back in June. We will continue to monitor these numbers and keep you updated for additional increases and decreases.”
Chief Financial Officer Dr. Ami Desamours said overall the information is not necessarily that the growth isn’t relatively healthy because it is. She said sales tax revenue from one year over the next is growing, but not at the more accelerated rate as what they projected before.
“It shows a healthy growth,” Desamours said, adding that the five-year plan is scaled back to be conservative. “What is decreasing is the estimates that we had in our current capital plan. What we are planning is based sufficiently conservative in revenue projections.”
Letcher provided an update to the school board Thursday afternoon that included major changes that will affect their capital plan moving forward.
She said the capital outlay millage had an estimate of $221 million for fiscal year 2025, a 6% increase over the FY24 amount.
Currently there is a $3.7 million decrease, which would equate to $82.5 million over a five-year period reduction.
The sales tax is slowing down in the district’s collection rate.
“We are about $3 million down from where we believed we would be at this time,” Letcher said. “When we do our projections, we go to the Economic and Demographic Research — they are also predicting a slowdown in sales tax.”
With the projections, she said they are decreasing their projections for FY25 from $129.79 million to $122.6 million — a decrease of $7 million. She said the anticipation is $46 million decrease in sales tax revenue through the end of the sales tax period.
Desamours said the revenue from FY24 to FY25 is still increasing.
Letcher said there are also lower collections for impact fees. The current year is down about $9 million, she said.
“So, based on that, we are looking at decreasing impact fee projections. We had currently projected about $36.9 million. It’s dropping to $30 million,” Letcher said.
Over a five-year period, that would be about a $50.1 million reduction.
Board member Cathleen Morgan said maybe it’s time to reopen the conversation with the county commissioners regarding impact fees.
Board member Armor Persons said the impact fees are what bother him the most, and he agrees, a conversation with the county commissioners is needed.
“The five-year is pretty conservative,” he said. “In the five-year plan what would slow that down is the permitting process. Some of these developments have not yet been permitted. That will be more in the five-to-10-year projection.”
Persons said in the next five years, there will be so much that will be built and come online.
“I appreciate you being conservative,” he said.
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