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A threat by Gov. Mike Leavitt to veto a bill promoting equalization of school capital outlay budgets has polarized opponents and proponents. The governor has until March 23 to decide how he will deal with SB199, which would draw two mills of local tax money from all 40 Utah school districts to create a pool from which the poorest districts could draw for building and maintaining schools.

The bill attempts to address inequities in the ability of each district to raise money to meet its own needs.Property taxes - specifically those related to building and maintaining schools - differ significantly across the state. And as a rule of thumb, the poorer the district you live in, the higher your school taxes will be. There are exceptions, but in general, school districts that have the poorest tax bases must ask taxpayers to dig deeper to meet school needs.

A Deseret News/KSL poll indicates strong support for the concept of equalization for all school districts. (See related story.)

The fact that the majority of Utah's schoolchildren - 70 percent to 80 percent - live in the districts that are poorest and growing fastest contributes to funding problems, said State Superintendent Scott W. Bean.

Alpine, Davis, Granite and Jordan districts, which combined have responsibility for roughly half the students in Utah, are below the state average in the amount of property value generated per student.

The assessed valuation per student in 1992-93 ranged from $55,155 in South Sanpete District to $701,340 in Millard District. The state average is $120,737. SB199 would bring the state's lowest districts to the average, which is not complete equalization, Bean noted, but narrows the inequities considerably.

Leavitt said his decision on SB199 would be "the toughest I have to make about this (legislative) session."

The prospects of tax increases in many of Utah's school districts to meet the requirements of SB199 set off alarms in the governor's office. The bill would require all school districts to contribute 2 mills of local tax income to a pool, phased in over four years. Some districts would be able to make their contribution from existing tax income, others would have to raise taxes.

The Utah Taxpayers Association reacted strongly to the bill in the final days of the legislative session, saying it had the potential to generate the biggest tax increase to come out of the 1993 session.

The association distributed fliers showing that SB199 could add about $27 to the taxes on a $100,000 home at the end of the four-year phase-in. The bill removes the "pain" the state's richest districts felt when they were being asked to foot the equalization bill, the tax watchdog said. That pain was incentive to reform the system, it suggested.

Some districts have been inflating their budgets for several years in anticipation of the push for equalization, and waste and abuse will grow if SB199 is implemented, the organization said.

Proponents, however, say the bill would not hit taxpayers any harder overall than its predecessor, the controversial "Robin Hood" law of 1992. SB199 spreads the burden more equally over the districts, builds an equalization pool more quickly and will offer more help faster to districts that are hurting.

The income from the pool - approximately $22 million over fouryears - would go to those districts least able to generate tax income from their property base, leveling the inequities that now exist, said the bill's sponsor, Rep. Kim Burningham, R-Bountiful.

Distribution is based on a formula that takes into account the district's ability to raise capital outlay money, the rate of growth and how many "unhoused" students the district has.

The effort to equalize began several years ago with a study of capital outlay budgets by the State Office of Education.

"There are huge disparities in the districts' wealth per pupil," said Bean, who was then associate superintendent over finances and headed the study. "These disparities have significant impact on the ability of districts to construct and maintain facilities."

It's hard to convince taxpayers to take on a bigger load when it doesn't have the potential to have a big impact on needs, said Alpine Superintendent Steven Baugh. District officials tried three times in the 1980s to raise taxes to help house a growing number of students. Each time, the effort was voted down. Last spring, Alpine taxpayers approved a 2-mill tax increase and $30 million bond to build new junior high schools.

Alpine would be one of the big winners, if SB199 becomes law, Baugh said. After the fourth year, if the district raises taxes to meet its required 2-mill share, it would get back almost $3.9 million. If it takes its share out of existing tax levies, it would then receive $2.7 million.

SB199 would replace the controversial "Robin Hood" law passed during the 1992 session. That plan recaptured local property tax money from rich districts and redistributed it among the poor. It raised hackles in Salt Lake, Murray and other districts that said it imposed an unfair burden on them. They threatened to sue if the plan were left in place.

On the other hand, for several years, poor districts have threatened to sue if the inequities were not addressed.