The Central Lee School District's attempt to pass a multi-million dollar bond referendum to fund facility improvements came up just short last fall, so the district will try again during a special election on Tuesday (September 10). The head of the district said this is the time to act to provide a better education for students for years to come.
Superintendent Andy Crozier said the district is seeking permission to issue nearly $13 million in general obligation (G.O.) bonds, which are paid back through property tax revenue.
The list of proposed projects includes:
- Secure Entrance at K-8 Building
- Secure Entrance at High School
- New Multi-Purpose Gymnasium
- New Classrooms for Band/Vocal Programs
- New Preschool Classrooms
- New ADA-Accessible Locker Rooms
- Space for a Culinary Arts Classroom
- Expanded High School Commons Area
Crozier said by issuing G.O. Bonds, the district will save money on interest payments.
“Your interest rates for G.O. bonds are going to be 1% less than a sales tax bond,” said Crozier. “What that means [what we will save] over 20 years for this project is about $6 million [in interest]. So we said, let’s do this all G.O. bond and save the taxpayers $6 million over the course of 20 years.”
Crozier said this was not an option last fall because the district’s bonding capacity was not high enough to allow for the issuance of only G.O. bonds. He said that’s why the district was going to issue a combination of G.O. and sales tax bonds, thus forcing the district to pay higher interest rates.
Crozier said it’s an option now because the district’s property value has increased 24%, primarily due to the Dakota Access crude oil pipeline coming online and being included in the property tax rolls. He said the increased property value means the district has a higher bonding capacity.
The property value increase is also significant to the bottom line of taxpayers.
Crozier said the district’s property tax rate currently sits at $12.19.
He said in a typical year, the passage of the bond would add an additional $2.70 to the property tax rate. He said this is not a typical year, thanks to the pipeline, so if the bond is approved on Tuesday, the tax rate would remain $12.19.
“We are able to absorb about $2.30 of this $2.70 thanks to the property value increase districtwide,” said Crozier. “The other $0.40, we will use sales tax revenue to provide property tax relief.”
But there is a flip-side to that. If the bond vote fails, the property tax rate will drop.
“We have been very open and honest about that,” said Crozier. “Because people do ask that question quite a bit. ‘If you are going to take $2.30 and put it toward the G.O. bond and this would fail, ultimately [the tax rate] would go down right?’ That’s correct.”
Crozier said the rate might not decrease the full $2.70, but he said the decrease would be at least $1.00. A $1.00 decrease in the property tax rate would save the owner of a $100,000 home less than $60 per year.
“You are never going to have this opportunity again to help the students in this district for years to come,” said Crozier. “This is a one-time deal for our district because if we come back in two years, obviously the tax rate will have dropped, but we will be talking about increasing it back to where it is now, about $12.19.”
Crozier said if the bond issue is approved, construction on some projects could get underway as soon as school dismisses for summer.