Capital Project Levy

CASE STUDY: ISD #356 / Lancaster School District

The Goal

The Lancaster, Minnesota, School District serves an area with a population of 852 people, with agricultural property making up approximately 80% of its tax base. When one of the School District’s multiple Operating Referendums approached expiration in 2021, the District planned to renew the levy.

The Solution

The District engaged Ehlers’ School Finance Team for Levy Planning & Assistance. Ehlers analyzed the District’s current debt and the community’s tax base and proposed a Capital Project Levy instead of renewing the existing Operating Referendum, which generated revenues only from residential and commercial properties. By drawing on the full tax base including its agricultural properties, the District could significantly reduce the tax impact on residential properties. Ehlers educated District leaders on Capital Project Levies, worked with them to identify eligible costs and helped them craft ballot language.

The Outcome

The voters passed the levy 303 to 188, providing critical funding for important technology, building maintenance, transportation and other needs. Importantly, the District gained trust with the community for easing the tax liability on residential properties and demonstrating sound budget management practices.