§ 6943 Port District Initial Funding

This law lets a new district borrow money to run a port and then set its first tax rate high enough to pay for running the port and paying back the borrowing for the first full fiscal year.

Key Takeaways

•A district can borrow money to run a port right after it is formed.
•The first tax levy must be big enough to cover both operating costs and the debt taken on.
•The levy is set for the first full fiscal year after the district’s formation.

Example

A port district is created on March 15. It borrows $2 million to build new docks and estimates $500 k in operating costs for the first year.

The district must set its first tax rate so that it collects at least $2.5 million (the $2 million debt plus $500 k operating costs) to cover everything for that first year.

How to Calculate

Tax Levy Amount = Operating Costs for the first fiscal year + Debt Obligations incurred

Figure out how much money the port will need to operate for the first full fiscal year.
Figure out how much debt (principal + interest) the district has taken on to run the port.
Add the two numbers together to get the total amount the district must raise.
Set the tax rate so that the total taxes collected equal that total amount.

Same district as above.

Result: Tax Levy Amount = $500,000 + $2,000,000 = $2,500,000. If the district’s taxable property value is $50,000,000, the tax rate would be $2,500,000 ÷ $50,000,000 = 0.05, or 5%.

From the time of the organization of any district until the next succeeding July 1st, or in the event that a district is formed between February 1st and July 1st of any year then until one year from the next succeeding July 1st after the formation thereof, the district may incur indebtedness for the purpose of operating the port and the district and in the first tax levy, the rate shall be in an amount sufficient to operate the port and the district for the first full fiscal year as well as to pay the obligations incurred as herein provided for. (Amended by Stats. 1947, Ch. 563.)

This law lets a new district borrow money to run a port and then set its first tax rate high enough to pay for running the port and paying back the borrowing for the first full fiscal year.

Key Takeaways

•A district can borrow money to run a port right after it is formed.
•The first tax levy must be big enough to cover both operating costs and the debt taken on.
•The levy is set for the first full fiscal year after the district’s formation.

Example

A port district is created on March 15. It borrows $2 million to build new docks and estimates $500 k in operating costs for the first year.

The district must set its first tax rate so that it collects at least $2.5 million (the $2 million debt plus $500 k operating costs) to cover everything for that first year.

How to Calculate

Tax Levy Amount = Operating Costs for the first fiscal year + Debt Obligations incurred

Figure out how much money the port will need to operate for the first full fiscal year.
Figure out how much debt (principal + interest) the district has taken on to run the port.
Add the two numbers together to get the total amount the district must raise.
Set the tax rate so that the total taxes collected equal that total amount.

Same district as above.

Result: Tax Levy Amount = $500,000 + $2,000,000 = $2,500,000. If the district’s taxable property value is $50,000,000, the tax rate would be $2,500,000 ÷ $50,000,000 = 0.05, or 5%.

Key Takeaways

Example

How to Calculate

Key Terms

References

§ 6943 Port District Initial Funding

Key Takeaways

Example

How to Calculate

Key Terms

References

Key Takeaways

Example

How to Calculate

Key Terms

Related Statutes

References

Key Takeaways

Example

How to Calculate

Key Terms

Related Statutes

References