Presented to Memphis City and Shelby County\'s School Boards and the Memphis City Council.

1. Summary of Findings March 1, 2011 Steve Redding Charlie Santo Regional Economic Development Center University of Memphis

3. Study completed in May 2008 Both MCS and SCS commissioned REDC to examine fiscal impacts of SCS converting to Special School District Did not consider impacts of consolidating or merging two districts

4. Multiple Scenarios Considered Two District Boundary Alternatives Two Local Property Tax Alternatives

5. Boundary Alternative 1: Constrained MCS Boundaries

6. Boundary Alternative 2: Expanded MCS Boundaries

7. Local Property Tax Alternatives Property Tax Alternative 1 [Countywide Levy] Similar to the status quo Shelby County government would continue to serve as the primary local funding source for each school district. Shelby County government would continue to levy a property tax for education, and revenue from that tax would continue to be allocated to each district based on its average daily attendance (e.g., if Memphis City Schools has 70 percent of the county’s students, it would receive 70 percent of the revenue generated by the county property tax for education). The new Shelby County special school district would be able to levy an additional property tax within its boundaries as a supplemental revenue source.

8. Local Property Tax Alternatives Property Tax Alternative 2 [District Levy] Shelby County government would discontinue using property taxes to fund the special school district and Memphis City Schools With the creation of a special school district each district would levy its own property taxes as a primary local funding source.

9. Enrollment: Baseline (2008-2009)Boundary Alternative 1 [Constrained MCS]

10. Property Tax Revenue: Baseline (2008-2009)Boundary Alternative 1, Property Tax Alternative 1 [Constrained MCS], [Countywide Levy]

11. Shelby County Special Total Memphis City Schools School District Enrollment 159,012 116,113 73% 42,899 27% Assessed Value (real property) 15,592,328,065 $ 9,843,672,470 $ 63% 5,748,655,595 $ 37% These exising property tax revenue sources would go away: Main funding from countywide property tax (@2.02) 314,965,027 $ 229,263,043 $ 85,701,984 $ Supplemental MCS funding from city property tax (@0.86) 84,655,583 $ NA Total Property Tax Funding 313,918,626 $ 85,701,984 $ Existing property tax revenue sources would be replaced w/ new district taxes Tax rate required to replace former funding from countywide property tax 2.3290 $ 1.4908 $ Tax rate required to replace former supplemental MCS funding from city property tax 0.8600 $ NA Total new tax rate required to replace former property tax revenue 3.1890 $ 1.4908 $ District Property Tax Base (Assessed Value)/Student 84,777 $ 134,004 $ Property Tax Revenue: Baseline (2008-2009)Boundary Alternative 1, Property Tax Alternative 2[Constrained MCS], [District Levy]

12. Property Tax Revenue: Baseline (2008-2009)Boundary Alternative 1 [Constrained MCS], Property Tax Alternative 2 [District Levy] Property Tax Base Enrollment

13. Property Tax Revenue: Baseline (2008-2009)Boundary Alternative 1, Property Tax Alternative 2[Constrained MCS], [District Levy]

14. Tax Rate Implications: Baseline (2008-2009)Boundary Alternative 1, Property Tax Alternative 2 [Constrained MCS], [District Levy]

16. Property Tax Revenue: Baseline (2008-2009)Boundary Alternative 2 [Expanded MCS], Property Tax Alternative 2 [District Levy] Property Tax Base Enrollment

17. Tax Rate Implications: Baseline (2008-2009)Boundary Alternative 2, Property Tax Alternative 2 [Expanded MCS], [District Levy]

18. Property Tax Revenue: 2020Boundary Alternative 1 [Constrained MCS], Property Tax Alternative 2 [District Levy] Property Tax Base Enrollment

19. Property Tax Revenue: 2020Boundary Alternative 2 [Expanded MCS], Property Tax Alternative 2 [District Levy] Property Tax Base Enrollment

20. Property Tax Alternative 1 [Countywide Levy]: The creation of a special school district would not necessarily create any new imbalance in tax revenue per student between the two districts. Since property taxes collected countywide would continue to be distributed proportionately to the two districts, the countywide tax revenue per student would be remain equal for Memphis City Schools and the Shelby County special school district. Property Tax Alternative 2 [District Levy]: Would create an imbalance in the two districts due to the ratio of available tax base to school enrollment that would exist in each. The district property tax base per student would be lower for Memphis City Schools than for the special school district. In the long term, this imbalance could subside if MCS experiences the declining enrollment that has been projected.