The following was submitted to The Evening Leader as a Letter to the Editor but was refused for being too long, according to Mr. McKee. It was published by The Evening Leader as a paid advertisement. As an advertisement, it was not printed on the same pages as accepted Letters to the Editor on the same subject, and was not included in The Evening Leader's online edition with accepted Letters. It is reprinted here at the request of Mr. McKee.
The administration and the “yes committee” keep saying we have to do this now, we have to lock in the state money for the new middle school. The only thing we are locking in is the percentage each side pays for the project, not the dollars. Currently it is 38% for us and 62% for the state. If we do not pass the 6.9 mill bond levy and the ELPP lapses, we go from 38% to 41% and the state picks up 59% of the cost of the project, (according to the discussion at the public meeting on October 5th.)
If the bond levy passes and we wait, for example, 10 years to become eligible for the state money to complete the project, we will be reassessed before construction could start on the middle school. At that time we would need a bond levy to pay for increased costs due to inflation. The current projected cost of the construction is about $61,000,000. This is in current dollars not in 10 year inflated dollars! If the total project cost, lets say, went to $71,000,000 we would be responsible for 38% of the difference or $3,800,000 of additional expenses that would not be covered by the proposed bond levy.
Another quirk of the reassessment process, whether the levy passes or not, is that our re-evaluation could be high enough to actually push us further down the equity list. This would add more delays and expense to the project. We are currently at 250 on the 2004 equity list, down from 243 on the 2003 listing. The OSFC has been funding 10 projects a year except for 2004 in which they are only funding 9 projects. They have funded about 135 projects to date. This means that in 11 and one half years, if every thing remains the same, we may be eligible for state funding if it is available. This is based on OSFC continuing to fund 10 projects a year. It is also interesting to note that the board took action at the October meeting voting to file for an extension of the ELPP for one year. This puts them in a position to bring this issue back to the voters next year if it fails November 4th.
Something else you’re not being told is the manner in which the bonds are being structured for the new high school. Please read this carefully, it is a bit tricky. In, a traditional bond, as explained to me by the county auditor’s office, you basically take the amount of the bond, including interest, divide it by the term, number of years, and that number becomes the repayment amount for each year of the bond. The only down side of this plan is that in the first year the auditor would have to collect extra millage to make the first bond payment. The up side of this for the taxpayers is that the millage would be reduced as property values increase. This doesn’t mean you will pay less, but you won’t pay more, except for the first year.
The superintendent has structured this 6.9 mill bond and the 4.1 mill bond for the expansions to East and West so that they are, for lack of a better term, rear loaded. The rear-loaded bond does not have the principle reduced in equal amounts. As an example: the first principle payment on the current 4.1 mill bond was $135,000 the last payment, will be $700,000. What this does is increases the interest earned by the bondholders. If the 6.9 mill bond issue is approved we will be obligated for 29 years to pay for it. During this 29-year period our property values will increase. Let’s say you live in a $100,000 home. You will pay about $218 a year at the start of the bond. As your property value increases you will pay more in taxes. Near the end of the bond your property has increased in value, let’s say, to $187,000 (3% a year for 29 years). You would now be paying about $407 a year or more. The difference is almost double because the millage does not significantly drop it remains basically the same for the term of the bond. This extra money doesn’t go to retire the bond it goes to the bondholders as interest payments. This may not seem significant now, but in 29 years when a now 30 year old is looking at retirement it could be. How about the people already on a fixed income? This will become significant to them as inflation erodes their earnings. Are we in this for the benefit of the bondholders or should we consider the impact this will have on the current and future taxpayers of the district?
There is only one method of financing the education of our children, taxes, unless of course we get a windfall from some generous benefactor. It should be the obligation of the school board to examine every avenue of financing and choose the course, which not only meets the needs of the district but; is the most cost effective for the people paying the bills. This, in my opinion has not been done with these issues.
Folks, the proponents of the new school are trying to make these levies an emotional issue, urging you to vote with your hearts. Every one really does want the best for our children, but this has to be looked at as a business decision. It is a business decision for each and every household in the district. You need to vote with your head and not your hearts. Consider the school district as a corporation. The board of directors of this corporation who’s job it is to educate you about the risks and benefits, have not been forthright. They have not been honest enough to have the stockholders, you the taxpayers, support these issues with your dollars.
The proposed 6.9 mills levy needs to be rejected. We are going to incur additional expenses regardless of the route we choose. When we are within the 2-year funding umbrella of being eligible for the OSFC, we should know where we stand with the allocation of state matching funds and whether the money will actually be available. The state’s financial situation is not going to improve any time soon. Will a future legislature decide to balance the budget at the expense of OSFC funding?
The most important solution is to elect 2 individuals to the school board to be your voice on any future issues. They need to be the 2 strongest and most informed of the candidates vying to replace the current board members. I believe it is a fore gone conclusion that a change is necessary from top to bottom of the management team of our school district. We need an infusion of informed and dynamic individuals.
Ladies and Gentlemen, on November 4th you have an opportunity to send a message to this board and administration that now is the time to begin the process of change for the long-term health and success of our school district.
Please vote on November 4th!
Paid for by the committee to elect Rees McKee
Rees McKee, Treasurer
The following article by Mr. McKee was not submitted to the newspaper. As it remarks on statements and events which are not readily available to readers of The Spring Street Journal, we invite the individuals mentioned to respond to webmaster@ridertown.com. Responses will appear immediately below the following, in their entirety and unedited (excepting conversion to .HTML), within 24 hours of their receipt and confirmation.
Mr. Superintendent,
I would like to set the record straight on comments you made at the October 20th public meeting. You were asked what you were going to do with the extra $750,000 dollars from the permanent 1% income tax being proposed. You stated there wasn’t a surplus. I believe what you meant say was there wasn’t a surplus in the context of passing both levies, because part of this money would be used for the construction costs associated with the new school.
At the July board meeting, which you explained was a week later than normal because you needed more time to examine the budget simulations you recommended a 5.9 mill emergency levy and a one year deferment on the school project. Although this was never acted on, it was your recommendation. I can only assume that with the additional week of study of the budget simulations this was a recommendation you and the treasurer were comfortable with.
At the Oct. 20th public meeting you said I had failed to mention in my newspaper article a 2006 operating levy as part of the 5.9 mill emergency levy. I have reviewed the videotape of the July school board meeting, at no time was there discussion about a 2006 levy. You referred to the states next biennial budget, maybe you were confused.
This recommendation took place before Mrs. Anna Katterhenry derailed your proposal with her suggestion of an income tax for operating and millage for a new school. At this point you went on to explain how an income tax was much more flexible and that it could be used for construction or operating, basically anything.
I believe this is yet another example of this board’s and administration’s misrepresentation of the facts. It is time for a change. Change adds value to our lives. Although change generally is considered painful, it is a necessity of our existence. I truly believe the adage “that what ever doesn’t kill you makes you stronger”. We need to move forward from the crucible these issues have created, tempered and stronger for the experience. It is imperative that 2 new strong board members be elected to affect the positive changes necessary for our school district’s future. If it is your desire, I would like to be one of those.
Rees McKee
Editors Note: As of 4:30 a.m. Tuesday, November 4, 2003, no response has been received as invited above.
