October 15, 2009
Next month, Granite, Duchesne and Davis school districts will ask voters for approval to borrow money to build and upgrade schools.
Two of the three bond proposals are endorsed by the Utah Taxpayer Association, which has taken no stance on the third.
But how much weight that endorsement carries at the polls is uncertain. Despite strong opposition from the watchdog group, Nebo School District’s construction bond passed by a narrow margin in June. And of the three bound for ballots Nov. 3, the one most likely to face an uphill battle is the one most “heartily” endorsed by the association: Granite School District’s Proposition 1.
The $256 million bond has few detractors.
Among the groups to voice support at a news conference on Thursday were the teacher’s union, PTA, a coalition of business leaders, Salt Lake County and the cities of West Valley, South Salt Lake and Holladay.
Most of the money, about $61 million, will be used to install air conditioning in all 51 of the district’s schools. The rest will pay for three new schools and to completely rebuild five others, including Olympus and Granger High.
With interest-rates at an all-time low, and construction costs leveling, “it’s a wonderful time to do this,” said Granite Superintendent Stephen Ronnenkamp. More importantly, he said, the bond issue will come at no extra cost to taxpayers.
“Read my lips,” said Ronnenkamp. “There will be no tax increase.”
School districts commonly pitch bonds as a way to borrow money without raising taxes, despite ballot language to the contrary.
“But this is the first time that’s actually true,” said Taxpayer Association Vice President Royce Van Tassell.
For more than a decade, Granite has covered construction costs on a “pay-as-you-go” basis, using $17 million in existing capital funding. But that will no longer suffice, say district officials who now propose leveraging that $17 million to borrow more.
In other words, they will use the $17 million to repay the bond.
That’s in contrast to Davis County School District, which intends to piggyback a new $250 million bond onto another bond that’s soon to mature.
It won’t mean higher payments for Davis County home owners.
“But it they weren’t bonding, property taxes would go down,” argued Van Tassell. “That, by definition, is a tax increase.”
Van Tassell hasn’t taken a position on the Davis bond proposal, partly because the district is faced with such momentous growth, he said. Also, the savings homeowners would reap are marginal, about $17 annually on a $250,000 home.
But school construction bonds are an easy sell in Davis. The last two bonds issued in 2006 and 2002 had approval ratings of 79 percent and 89 percent, respectively, said Davis spokesman Christopher Williams.
Granite, on the other hand, hasn’t asked to borrow money since 1983.
“It’s a big unknown, because we haven’t had a bond election in 26 years,” said Granite spokesman Ben Horsley. A district poll showed 65 percent of voters likely to approve a bond issue.
The taxpayer association has also endorsed Duchesne County School District’s quest to borrow $49 million to rebuild Altamont and Union high schools, and build a new elementary school in Roosevelt. That proposal would raise taxes by an average $168 a year, possibly more if the energy boom continues to fizzle.
But Duchesne Superintendent John Aland says the two high schools, both more than 50 years old, are falling apart. The boilers are failing and electrical systems are at capacity.
“It will cost us more to retrofit them than tear them down and rebuild them,” said Aland. “When we’ve torn down other buildings this old, we’ve found old cast-iron sewers leaking, which is scary to me. You don’t want raw sewage under your schools.”
On Nov. 3, three Utah school districts will ask voters to borrow money to upgrade and build schools. Here’s how much they want, how they’ll spend it and how much it will cost taxpayers.
Wants: $256 million
For: Air conditioning in 51 schools; rebuild Granger and Olympus high schools, and Hartvigsen, Oakwood and Woodstock elementary schools; build an elementary in West Valley City and an elementary and junior high school on the district’s northwest side.
Cost to taxpayers: Nothing.
Wants: $49 million
For: Replacing Altamont and Union high schools; building a new elementary school in Roosevelt; and refurbishing elementary schools.
Cost to taxpayers: An average $168 per year, possibly more if home values fall as some have predicted.
Wants: $250 million
For: A new junior high school in west Kaysville; three new elementary schools (west Layton, West Point and a third to be determined based on growth); a school for medically fragile students; rebuild Wasatch Elementary; add 12 classrooms to Millcreek Junior High; add 10 classrooms to Woods Cross High; add six classrooms to Layton High; finish 18 classrooms at S. Weber Elementary; purchase property for future school sites; replace roofs, boilers and waterlines where needed, and upgrade parking lots, fire alarms and technology systems.
Cost to taxpayers: Over nine years, the average taxpayer will pony up $156, money they will get back if the bond fails.