The first of the Liberty County Board of Education’s HB 581 opt-out hearings drew a crowded board room Tuesday evening.

The school system, like many systems the state and many of its neighboring systems, has given notice it intends not to take part in the new homestead exemption bill passed by the state last year. Bryan County and Long County, among others, also have declared their intention to opt out.

One of the reasons cited for opting out is the new law limits the revenue school systems receive when setting millage rates.

“We may be required to raise the millage rate to maintain the level of services we offer our children” said Janine Graham of the school system’s finance department. “If we stay in 581, the tax burden will shift to a higher percentage of the taxes being paid by those residents with non-homestead properties, small businesses and people with more than one property. But raising the millage rate will impact everyone.”

While cities and counties can impose a local option sales tax to raise revenue for general operations, school systems are prohibited from doing so, Graham and school board chair Verdell Jones pointed out.

“By law, the school system is excluded specifically from implementing or participating in an additional penny sales tax,” Graham said.

The school system’s education special purpose local option sales tax, which is approved by voters, cannot go toward such expenses as paying salaries for teachers, bus drivers or administrators, Jones noted.

Currently, the school board levies a millage rate of 14.441. It is capped at 20 mills. The millage rate was 16.5 in 2018 and it is lower now than it was in 2010.

“We know we will need to meet needs for the growing student population,” Graham said. “We want to maintain fiscal stability. We do not have the option to raise additional funds to replace the lost revenue. Opting out allows the school district to determine the millage rate based on the specific needs of our students, schools, and community.”

The school system’s share of QBE, or Quality Basic Education, funding from the state is not adjusted for inflation, Graham added, and the system makes up the difference through its property tax receipts.

Had HB 581 been in place five years ago, the school system would have lost out on nearly $4 million in revenue and nearly $1.6 million in the past year, Graham said.

School systems also have struggled with the law’s wording.

“They said the language was going to be confusing,” Jones said, “and it is.”

“The language in this bill is so misleading and so confusing,” said board member Carol Guyett.

Guyett, the longest- serving member on the board, added the board has been good stewards of the money, pointing out the system has built new schools and renovated every existing school.

“There is not a school you can go into that is not in good shape,” she said. “There are things we do that are unique to Liberty County. And we want to keep doing it. We are handling the most valuable asset Liberty County has — your children. They should have priority in everything.”

Guyett also pointed to the one-time only decision local boards have to make with opting in or out.

“The actual long term impact of 581 is undetermined. This is our best estimates,” Graham said. “Opting out allows the school district to determine the millage rate based on the specific needs of our students, schools, and community.”

Residents who spoke at the school board’s first public hearing also espoused the confusion about the legislation, with questions on how the school board could opt out on its own. Others also questioned why there is no exemption for senior citizens when it comes to school board property taxes.

“There are so many counties where senior citizens don’t pay a school tax,” said James Wise.

John McIver, the former longtime chairman of the county commission, also said senior citizens cannot afford the high property taxes. His own property values, he said, have gone up $115,000 in the last four years and went up $38,000 in the last year.

McIver, who chairs the board of elections, also said Liberty County residents overwhelmingly voted in favor of HB 581.

“That tells me, as a citizen of Liberty County, that the citizens thought this bill was well in keeping with something they wanted our local school board and city and county to implement,” he said. “Yes, the bill provides for opt out. But the bill was titled homeowner tax relief. The vote was overwhelming for it to try to implement it in some respect.”

David Jacks also questioned if the school system is doing its job. He said he made a trip to a fast-food restaurant in 2022 and gave the counter person a $50 bill. The young man opened his phone, opened an app, took a picture of the bill and then looked at the number and type of coins and bills he needed to return as change.

“I told him he needed to go back to school. He told me he graduated in ’21 from this school district,” Jacks said.

Jacks said he also looked up salaries on the school system’s personnel and “I was so mad. Disappointed would be another word.

“My child will never come to these public schools,” he said. “They will go to a private school or I will be moving out of the county.”

Jacks also chided school board members, saying they didn’t read the bill closely.

“Future senior citizens, future disabled citizens and future disabled veterans will have to pay more,” he said. “Sorry if you didn’t that to come out, but there it is.”

Graham said the decision to opt out won’t affect any existing homestead exemptions, but Wise said the qualifications for the current exemptions are difficult.

“Anything I tried to apply for, I made too much,” he said. “If you can qualify for those exemptions, you’re close to being homeless.”

McIver also wondered if the school system stands to lose as much as it thinks in revenue. The most recent digest, he said, was at over $2 trillion and was up nearly $204 million from the previous year.

The school board will hold two more hearings, January 28 at 8:30 a.m. and February 11 at 6 p.m.

“I will probably be back,” McIver said.