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School districts that deduct money from employee paychecks to help fund levy campaigns are not breaking the law by doing so, according to the chief legal counsel for the Ohio School Board Association.
But a state anti-tax group claims the practice is an illegal use of resources and personnel of publicly funded schools. Officials with the Cincinnati-based Coalition Opposed to Additional Spending and Taxes (COAST) say they are exploring whether to take legal action to stop school districts from engaging in the activity.
“From our perspective, it’s a shakedown of teachers,” said Christopher Finney of COAST. The practice, he said, is “nothing new and it’s wrong.”
In Butler and Warren counties, Middletown, Fairfield, Mason and Kings school districts use voluntary employee payroll deductions to raise levy campaign money. Middletown and Fairfield both have school tax levies on the ballot next month.
Hollie Reedy, OSBA’s chief legal counsel, said Ohio Revised Code Section 3599.031 allows school districts to make certain types of voluntary payroll deductions for employees to support a ballot issue. She said this is different from ORC Section 3315.07, which prohibits districts from using public funds to support or oppose the passage of a school levy or bond issue or to pay an employee for time spent on any activity to influence the outcome of a levy or bond issue.
Reedy said the OSBA encourages school boards to work with their legal counsels if they decide to establish this type of program.
But Finney said the conflicting statutes may have to be decided by a court.
“It’s an improper use of tax dollars by soliciting or processing funds on pro-levy activities,” he said, adding it also takes time away from treasurers and their staffs doing their jobs. “This creates chaos with the (district’s) accounting staff.”
Fairfield schools Treasurer Nancy Lane said nine of the district’s 1,020 employees are currently signed up to have some of their pay deducted to help fund Fairfield’s 2.62-mill bond issue to build three new buildings. She said the district first started its deduction program to help raise funds for the district’s 2011 operating levy campaign. That year, there were 14 employees that participated in the program, Lane said.
“We do this for other organizations if they have a certain number of people who want to participate,” Lane said, referring to organizations such as the United Way, Fairfield Community Foundation or ReThreads. “Our employees asked the administration to set this up because it’s easier to have a donation deducted (spread out over time) instead of having to write a big check.”
Lane said in 2011, the district deducted $683. So far for the 2013 campaign, the district has deduction forms for a total of $1,035.
Middletown City Schools also has a bond issue and a permanent improvement levy on the Nov. 5 ballot. The 3.95-mill bond issue, if passed, would raise $55 million toward building a new middle school on the Middletown High School campus, as well as renovating the high school, which also includes building additional classroom space and a competition gym.
The 0.26-mill permanent improvement levy is to raise funds for capital improvement projects for the district that are now required by the state.
Middletown schools officials said their payroll deduction program has always been available upon request. Officials said the program is voluntary and there is a provision in the collective bargaining contracts with the district’s unions for these types of deductions.
So far, three of the Middletown schools’ 581 employees have requested to donate through this payroll deduction program. But as of last week, no funds have been raised because the first deduction will be this month, officials said. There were no employees who signed up for the program last year, officials said.
Neither the Mason or the Kings school districts have a tax issue on the Nov. 5 ballot.
Kings Treasurer Michael Mowery said the district implemented its payroll deduction program last spring, but quickly added, “We don’t push it.”
Of the 430 employees in the Kings district, 19 have signed up for the payroll deduction program. Mowery said he was “not surprised with the number” of participants.
“It’s completely voluntary,” he said. “We’re not putting any pressure on any individuals to contribute. It’s something we don’t ask.”
Mowery said the program generates about $100 a month for a future levy campaign, and the district receives $10 back as a processing fee. There are also no contract provisions requiring employees to participate, he said.
Mowery agreed with Lane that it’s easier to spread donations out over long periods of time rather than writing a check every four years.
He said the district deliberated on this matter for more than a year and that Kings’ superintendent has emphasized to employees that such payroll deductions are not required.
“We wanted to make sure that it was legal, and we learned that other districts had already been doing such a deduction program,” Mowery said.
Mason also offers a “strictly voluntary” payroll deduction program that about 400 of the district’s 1,195 employees chose to participate in, said Treasurer Richard Gardner.
He said the program has been in place since 2010 and that employees raised $11,335 in the past year.
Gardner said there is nothing in the collective bargaining contracts between the district and its unions to require participation. He said the district does charge a processing fee for the service and that donations are sent in a check from the district.
Middletown and Fairfield do not charge processing fees for their service. The processing fees are permitted by state law.
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