KEARNEY, Neb. — A Central Nebraska school district is lowering its tax levy but warns that locals will likely still see their property taxes go up.

The Kearney Public Schools Board of Education voted 5-1 on Monday night to approve the district’s budget for the 2023-24 school year. The budget includes a levy drop from $1.228 per $100 of valuation to $1.193, a decrease of 3.53 cents or 2.9%. The total budget is for $73.61 million.

A district news release says the levy decrease is made possible by soaring property values, which are expected to rise by 9.5%. That means the district will take in a projected $3.34 million more in property tax revenue despite dropping its levy. The decrease continues a trend for the district that’s seen its levy go down about 13.2 cents over the past decade.

“… KPS was the 7th lowest spending school district in the state per pupil and I wouldn’t anticipate the 2023-2024 budget would change that,” Associate Superintendent and Finance Director Dr. Chris Loofe said in a news release. “In fact, we are aware of districts with much greater increases than what we are reflecting.”

The district says its total state funding is up thanks to new special education money, but says the money coming form the state’s equalization formula is down about $100,000 from last year and about $3.5 million from a decade ago.

Superintendent Jason Mundorf says the increased budget is largely due to the increasing cost of paying salaries and benefits for staff. The district is tied to eight other schools in the state-mandated negotiations process and must keep pace with them. He says the teacher salary and benefit increase is 5.21% this year.

“It is impossible to hold costs back when we are experiencing inflation rates near 8%, our fixed costs increase, and we are in a teacher and staffing shortage competing for people,” Mundorf said in a statement. “If cutting taxes is our priority, our only recourse is to cut programs or people. Fewer teachers mean we’d have larger class sizes. Fewer programs could include a loss of athletic teams, a loss of transportation services, or a loss of co-curricular activities (orchestra, band, career-technical student organizations) as just a few examples. The reality is we can’t do both. We can’t have the quality educational experiences with high-quality professionals we currently enjoy and cut taxes simultaneously.”