WEATHERSFIELD SCHOOLS Facing tax loss, district seeks a state grant

RMI is reducing its tax payments after learning about an exemption.
By DENISE DICKand CYNTHIA VINARSKY
VINDICATOR TRUMBULL STAFF
MINERAL RIDGE -- Weathersfield school officials are hoping a grant from the state will temporarily stave off a financial shortfall.
Superintendent Rocco Adduci said the district learned Tuesday afternoon that it would lose about $600,000 in property tax this year and could lose additional money. That would likely throw the district into a fiscal emergency.
Adduci said the district has been consistently solvent and that the community regularly supports the schools with tax levies.
The problem comes from RMI Titanium's taxes and the state's public-school funding system, which the state Supreme Court has ruled unconstitutional.
Advice to RMI
Larry Jacobs, chief financial officer for Weathersfield-based RMI Titanium, said the company reduced its personal property tax payment by about $600,000 for fiscal 2001 on the advice of PricewaterhouseCoopers, its tax adviser.
PWC advisers recently told the company that, under Ohio law, it need not pay personal property tax on any inventory used to produce material for the U.S. military. About 30 percent of RMI's business is defense contracts, so that change dropped its taxes about $300,000.
The other $300,000 relates to a general drop in inventory related to the sluggish economy and a decrease in RMI's commercial aerospace and consumer product orders, Jacobs said.
"We're trying to be the most efficient taxpayers we can be," he said, noting that the company's personal property tax bill is about $1.5 million, even with the cuts.
RMI also plans to review its tax reports dating back to 1997 to see whether it might have overpaid, because company officials were not aware of the exemption for defense-related inventory.
"We just want to be sure we are paying a just tax," Jacobs said.
State's role
Adduci said the district isn't pointing fingers at the company. He blames the state Legislature and administration, saying they've dragged their feet in addressing public-school funding.
The court ruled several years ago that the state's reliance on property taxes to fund public schools was unconstitutional and ordered the Legislature to fix it.
"Five years after the court decision, the state still has not fixed the problem," Adduci said.
Money going to charter and community schools also presents problems for public schools, Adduci said.
Emergency money
State Sen. Timothy J. Ryan, D-Niles, is applying to the Ohio Department of Education for a one-time-only $1.8 million grant. The grant is for catastrophic fiscal emergencies, and if approved, would cover this year's loss and anticipated rebates for the company.
"The school district will be in fiscal emergency this year from losing $1.8 million in the next year," he said.
When a school district is declared in fiscal emergency, a state commission is appointed to determine where cuts are made.
Because the state Legislature has failed to deal with the problem, Ryan said, "market forces and tax exemptions now play a role in the type of education your children get."
He pointed to Republican leadership and Republican Gov. Bob Taft as standing in the way of Democratic attempts to fix the problem.
"This problem is nothing that could have been prevented by any officials here," Ryan said of the school district.