Point of Privilege Resolution No. 2-05A

WHEREAS, the Minister of Learning has announced that the government will force the amalgamation of public schools districts; and

WHEREAS, the forced amalgamation of school divisions will result in an estimated 21 million dollars of education funding taken out of rural Saskatchewan annually and shifted to urban centers; and

WHEREAS, there are indications that amalgamation of school divisions will not reduce costs, promote tax fairness or improve quality of education; and

 WHEREAS, the proportion of education tax on agriculture land is already unfair;

THEREFORE BE IT RESOLVED, that the government abandon the forced amalgamation of school divisions until the Government of Saskatchewan provides proof that amalgamation will provide an increased quality of education, guarantees cost savings, and does not simply shift the tax burden.

Response from Honourable Andrew Thomson, Minister of Learning:

Our government remains committed to the restructuring of school divisions in Saskatchewan recognizing that this initiative will strengthen the resources available in a new, larger school division and its capacity for providing high quality learning opportunities and supports. The primary purpose if restructuring is to increase equity in educational opportunities for students by using any saving to improve and broaden programs and services for all students. As well, the new governance structure will allow for the regional pooling of property tax resources that will improve equity for all property tax payers in Saskatchewan.

Our government's last initiative to support and encourage voluntary restructuring of school divisions set a goal to reduce the number of school divisions in the province by 25% prior to school board elections in October 2003. At the end of the initiative, the number of school divisions in the province was reduced by 18% to 81 school divisions. Our sense was that voluntary restructuring had run its course and would not occur quickly enough to achieve the level of change required to ensure that our provincial education system was sustainable in the long-term.

The resolution mentions $21 million taken out of rural Saskatchewan. With the advent of restructuring and based on the 2005-06 Budget Day estimates, approximately $13 million from negative grant boards will be redistributed to the new school divisions in the province, through the 2006-07 grant. We expect the rural school divisions will see equal benefit in the redistribution. To date, it has not yet been determined how the "recaptured" funds will be distributed, however, if the decision were to follow a simple per student method, approximately 95,000 students will be affected by the newly restructured school divisions (including restructuring of the Catholic school divisions), resulting in a redistribution of approximately $7 million to the newly restructured school divisions. This amount would go directly into rural locations and the remaining $6 million would be redistributed to the Lloydminster, northern, Regina and Saskatoon school divisions.

As you know, the Government of Saskatchewan is meeting its commitment to address property tax relief be dedicating $110 million in the 2005 and 2006 taxation years to reduce the education property levy on all properties in Saskatchewan that pay education tax. The education tax paid on property of equal value varies depending on the property class. For example, using the provincial average education tax mill rate of 19.26 mills, property valued at $200,000 would pay the following based on classification and percentages of value: residential – $2,696; business – $3,852; and, farmland – $2,119. An 8% education tax credit on all properties was chosen as the most equitable method of distribution since all property owners pay education property tax. Based on our consultation with your association, the Saskatchewan Urban Municipalities Association, and the Saskatchewan School Boards Association, it appears that this was the majority view of a fair way to distribute this short-term property tax relief in Saskatchewan.

Government recognizes the need to look at a long-term solution to education property tax relief and to be most effective, long-term relief must be based on the information coming out of revaluation, restructured school divisions and the new school operating grants system. The property assessment revaluation in 2005 will see agriculture assessment moving to a productivity based resulting in an overall aggregate shift in the increase in property values for agricultural land from the west side of the province to the east side. In addition, due to revaluation in 2005, the overall assessment of residential properties will increase approximately 13%, commercial and industrial properties an estimated 10%, while agriculture assessment remained about the same as 2001. Also, in part of the 2005 reassessment, owner of non-arable (range) land will now pay property taxes based on 40% of the property's assessed value. This is reduced from the 2001 50% and will limit the province-wide property tax shift to pasture land as a result of the 2005 revaluation.

In closing, I believe the Education Equity Initiative is moving forward in addressing the issues of sustainability and equity for all students and education ratepayers. These changes are creating a strong, equitable and sustainable system to ensure that all students in Saskatchewan have access to an education that is responsive, relevant and results-oriented – now and into the future.