School bond measure to cost taxpayers double

With interest, $150 million bond measure will be nearly $300 million

Hemet Unified School District
Hemet High School.

■ By Chris Smith / Advisory Editor

While Measure X on the upcoming Nov. 6 ballot presents itself as a $150 million bond measure to pay for school district repairs, upgrades, and safety equipment, the real cost to taxpayers will be twice the amount that the school district has been citing. The true cost is estimated at about $300 million, according to Riverside County’s deputy county counsel.
The truth about the bond measure is contained in a buried paragraph on the sixth page of the voter handbook describing the ballot measure.
“The best estimate of the total debt service, including the principal and interest, that would be required to be repaid if all of the bonds are issued and sold is $290,594,839,” says Riverside Deputy County Counsel Ronak N. Patel. In effect, voters will be paying double for what they’re getting in repairs and upgrades listed on the measure’s Bond Project List.

Little resistance
While there has been little organized resistance to the bond measure, taxpayers likely have been thinking about the measure as an inevitable fact of life. But the problem with Measure X, like all the other bond measures on the ballot, is that the school district is borrowing the money – a large amount of money – to pay for repairs that seem to represent years of deferred maintenance. Some might argue that many of the proposed repairs should have been paid for out of maintenance and operations funds. Since teachers in Hemet now each make about $125,000 a year in pay and benefits, it’s fairly obvious where all the money has gone.
The reassurance within Measure X that none of the bond money will be used for staff salaries seems to overlook the fact that the staffs have been quite well taken care of to date, perhaps at the expense of the district’s facilities, which now need more than a $150 million infusion of new capital.
We say “more than” because the measure makes it clear that the $150 million is a starting point and may not meet all of the district’s requirements, or pay for the lengthy list of projects on the Bond Project List.
Again, in the voter handbook, we learn that “…the Board cannot guarantee that the bonds will provide sufficient funds to allow completion of all listed projects (on the Bond Project List).” The problem? A good number of projects on the list assume that the State of California will come through with matching funds, an assumption that is far from certain.
“Approval of Measure X does not guarantee that the proposed project or projects in the District, that are the subject of the Bonds under Measure X, will be funded beyond the local revenues generated by Measure X,” says the handbook.
“The district’s proposal for the project or projects assumes the receipt of matching state funds, which could be subject to appropriation by the Legislature or approval of a statewide bond measure.”

No state promises
While the district’s Board of Governors is hoping that passage of Measure X prompts the state to come through with an equal amount of money, no one has said that there have been any assurances from the Legislature that that would happen. Nevertheless, passage of Measure X qualifies Hemet for millions in state matching funds – “when they become available.”
What seems clear, however, is that the money raised from the sale of the bonds will not be used for anything else than what is on the Bond Project List, which, among other things, calls for “the acquisition and installation of drinking fountains, water bottle filling stations and related water dispensing equipment to provide clean drinking water to students.”
There are actually two sections to the project list, the first being “school safety and security,” and the second “school modernization, renovation, and upgrade.” The filling stations are part of the student safety and security plan, along with installation of metal detectors, better locks, and alarms in case of the unthinkable. In fact, the theme that got voters’ interest most when the district surveyed residents about the feasibility of a bond measure, was student safety, and this measure does address those concerns.

More than safety
However, $150 million is a lot of money for upgraded door locks, and the bond project list goes way beyond student safety.
It calls for the district to “modernize, upgrade, renovate, replace, rehabilitate, re-configure, expand, acquire and install and/or upgrade classrooms, classroom buildings, labs, career technical education facilities, restrooms, common areas and grounds and school support facilities (including library, multipurpose room/auditorium, food storage, preparation and service, cafeteria and office staff support facilities) whether permanent, portable, or modular, including interior or exterior as applicable, doors and windows, door and window hardware, roofs, rain gutters, and downspouts, walls, ceilings, floors and finishes, paint, siding, insulation and casework, cabinets, secured storage and carpets, drapes, window coverings, infrastructure, lighting sinks, drinking fountains (more drinking fountains!), fixture, signage, fencing, landscaping, furniture, and equipment.”

Condensed list
In brief, the measure has the following provisions, according to the district:
• If voters approve this ballot measure, Measure X will:
• Improve campus safety and security
• Renovate career-training facilities for science, technology, engineering, math and skilled trades
• Repair deteriorated infrastructure – roofs, plumbing, electrical and HVAC systems
• Modernize classrooms and labs to meet rising college admissions requirements
• Construct school facilities to accommodate enrollment growth

When you look at the actual list of things the district plans to do with the money, you realize that $150 million probably isn’t going to be enough, and matching funds from the state (or local voters!) is almost mandatory to take care of everything that is on the district’s wish list.

No tax rate increase
From the voters standpoint, the best thing about MeasureX is that it’s proponents claim it won’t raise the local tax rate. The “no-tax-rate-increase” financing plan simply extends (without increasing) the bond authorization that voters approved in 2012, say proponents.
Also, voters have the guarantee that the bonds won’t be used for salaries or pensions of teachers or administrators.
“Proceeds from the sale of bonds authorized by this proposition shall be used only for the construction, reconstruction, rehabilitation or replacement of school facilities…and not for any other purpose, including teacher and administrator salaries and other school operating expenses.”
The measure even calls for a citizens’ oversight committee to ensure that the bond money is spent for the purposes that were intended.
“The Board (of Governors) shall establish an independent citizens’ oversight committee (pursuant to Education Code Section 15278 and following), to ensure bond proceeds are expended only for the school facilities projects listed in the Bond Project List.”
Such reassurances certainly make the sponsors sound honest and upstanding and reinforce their sincerity when they say that the schools are in a state of disrepair and need better security. Why these same people have let the schools fall into disrepair in the first place is a question no one wants to bring up.

Is it affordable
Few dispute the need to provide first-world school infrastructure for the 20,000 students in the district including modern, up-to-date equipment to facilitate the learning process. But how much can the community afford?
Any responsible citizen with or without school age children will readily agree that investment in education is a smart investment, even a primary duty. Good schools have been shown to increase property values in the district.
An ad valorem tax would be levied and collected on property within the boundaries of the district to pay the principal and the interest on the bonds. The best estimate of the average annual tax rate at this time is $0.049 per $100 per assessment (or $49 per $100,000) of assessed value.

55 percent of voters
For the measure to be approved, fifty five percent (55%) of qualified voters who vote on the measure must vote yes.
A “YES” vote on Measure X is a vote to allow the district to sell the bonds and levy the necessary taxes to pay for the bonds.
A “NO” vote on Measure X is a vote against allowing the district to sell the bonds and levy the necessary taxes to pay for the bonds.
Some have questioned whether floating a bond is the only, or most economical, way to finance school improvements. Can we be sure that a bond measure and all its associated interest are necessary? Or could the district simply pay for the repairs out of an increase in the regular property tax for this purpose and use the revenue as it comes in? Must the district borrow all the money and ultimately pay double for the privilege? The bonds financing the repairs won’t be repaid until the year 2048 – some 30 years from now, and the interest paid out over that time will equal some $140 million..
Many taxpayers would agree that it’s one thing to float a bond to build a school that is going to last 30-50 years and quite another to borrow money for repairs which probably could have – or should have – come out of maintenance and operations funds. However, without federal funding for schools, and with the state of California virtually requiring local districts to float bond measures before it ponies up with matching funds, large districts like Hemet Unified are left with very few options. Measure X may be the frog that taxpayers have to hold their nose and simply swallow.

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