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program period, the tax rate required to generate the $800,000 will <br />decline from $.0216 to $.0186 per $100. The average annual tax rate <br />is $.0200 per $100 valuation. <br />The second amount results from a Board of Commissioners policy <br />dedicating a portion [$.023 per $100 valuation] of the County's <br />overall tax rate to debt service payments on bonds issued from 1988 <br />to the present. As shown on Table 11, revenues received from this <br />source will increase from $853,195 in FY 1992 -93 to $989,087 in FY <br />1997 -98, with average annual revenue of $919 803. Furthermore <br />combined property tax revenues ax <br />annual debt service requirements. <br />sales tax revenues, a separate re <br />below. <br />e not sufficient to meet they <br />This difference is made up from <br />venue source which is discussed <br />IPage - 10 <br />The third amount would result from dedicating a portion <br />' <br />[$.1164 per $100 valuation] of the County's overall tax rate to <br />debt service payments on bonds which may be issued for new school <br />improvements during the CIP period. A $50.0 million bond issue is <br />to be voted on in November, 1992 to finance the construction cost <br />of two new middle schools and a new high school. A second bond <br />issue vote ($24.0 million) will be necessary in the latter part of <br />' <br />the CIP period to finance the construction cost of two new <br />elementary schools. The debt service requirements for these <br />new <br />schools during the capital improvement program period are shown on <br />Tables 10 and 11. <br />' <br />In <br />addition to debt service payments, property tax revenues <br />are also used to pay for recurring capital needs. In the FY 1991 -92 <br />budget, $750,000 was appropriated to each school district for such <br />' <br />items, including vehicle replacement, equipment and furnishings, <br />and site development and building renovations. Of these items, all <br />but vehicle replacement [$125,000] would -be considered as school <br />' <br />building capital needs. Total appropriations were thus $1,375,000, <br />an amount equivalent to $.0382 of the current tax rate [$.805 per <br />$100 valuation]. Assuming the Board of Commissioners continues to <br />' <br />appropriate similar amounts during the six -year capital improvement <br />program period, the average annual tax rate required to generate <br />these funds would be $.0344 per $100 valuation [see Table 101. <br />' <br />Collectively, the average annual tax rate required to generate <br />funding for debt service and recurring capital needs during the <br />six -year capital improvement program period would be $.1938 per <br />' <br />$100 valuation [see Table 10]. If applied to a single - family home <br />with an average value of $135,674 in 1990, property taxes would <br />amount to $263. However, payments received in the future have a <br />' <br />lower value than in the present. The difference between the future <br />and present value is interest. Using the current bond interest rate <br />of seven percent (7 %), a property tax payment of $263 to be <br />received one year from now is worth $246 in the present. The method <br />for calculating the value is to divide the <br />present future amount, <br />$263, by one plus the interest rate (expressed in decimal form), or <br />$263 divided by 1.07 equals $246. The difference, $17, is interest <br />' <br />at 7 %. The general formulation is thus: <br />IPage - 10 <br />