Author: jan shaw

NO MEANS NO – Hinsdale High School District 86 – Referendum 3.0

You have no doubt heard the extreme and inflamed rhetoric coming from the D86 Board and their referendum supporters since November 2018 General Election.  So for the sake of truth and honesty, let’s recap what our tax and spend D86 Board has accomplished in the last two years.  On April 4, 2017 the D86 voters clearly and convincingly voted NO on the Board’s proposed $79,000,000.00 bond referendum.  And they did not listen.  So on November 6, 2018, D86 voters repeated themselves in a second rejection by voting NO on the Board’s proposed $166,000,000.00 bond referendum.  And still they did not listen.  So now your D86 School Board continues in its pattern of defiance of the voters’ will and is proposing yet another unacceptable bond referendum for the April 2, 2019 Municipal Elections; this time for $130,000,000.00.

                Unhappily, the taxpayers are being asked again to vote on a referendum that only serves to bailout the mismanagement and give-away contracts of this special interest agenda driven Board and its Administration.   So what is new and appealing about this bloated referendum effort?   In this instance the Board has adopted a new and clever tactic that it failed, or forgot,  to use in the previous two referendum failures; i.e. voter FEAR and INTIMIDATION.  Here is how it works, unless Referendum 3.0 is passed the Board will cut football, swimming, water polo and a variety of other popular student activities to generate the funds it needs.   By threatening these cuts the Board intends to apply maximum emotional and fiscal pressure on students and parents to force the referendum to pass.  However, what the Board has not considered in this scenario is addressing any of its unsustainable contracts and practices that are bankrupting the District.   Further, this Board continues to promote and sustain a divisive situation within the District by intentionally ignoring the fundamental resource and curriculum inequities between Hinsdale Central and Hinsdale South.  One would think that the Board would attempt to address and remediate these inequities in order to garner broad voter support.  Instead, it has chosen FEAR and INTIMIDATION, as well as maintaining the Status Quo, to force Referendum 3.0.  It is also their last chance to force a referendum before the Board turns over in April. 

                You will be hearing more hysterical and histrionic rhetoric from the D86 Board and their Yes supporters over the next 90 days.  Instead of sound fiscal and financial practices you will be hearing raw pandering emotion.  Therefore, as you hear these things, ask yourself and the Board (boe@hinsdale86.org) the following questions. 

1.       Why will the Board not utilize empty space at the South campus and correct the disparity in curriculums between the two campuses?  Would this not lessen the divisiveness between communities, as well as, minimize costs involved with a rebuild at the Central campus?

2.       Why will the Board not allow parents a choice in paying for sports before cancelling the sports and activities as they do in the overwhelming majority of suburban Chicago high school districts?

3.       Will the Board vote to reinstate the sports if its referendum passes?

4.       Why is the Board not supporting a $45 Million referendum as the D86 survey referenced in order to gain wide community support?

5.       Regarding the call for safety improvements – where is the verification by the state, federal or local authorities that such specific projects are really required? 

a.       If these improvements are required what is the time table in which they must be implemented, and could these projects proceed under existing bonding authority and District savings, thereby not requiring a referendum?   By using existing bonding authority and District savings the Board would not have to cut popular sports and activities. 

6.       Should not the Board’s goal be to minimize the divisive situation in the District by proposing a referendum that overwhelming passes?  

Thank you for your time and please stay engaged.  Also please feel free to share this email with  your family, friends and neighbors.  For further information on these topics please see the following websites.  

  1. https://www.citizensforch.com/
  2. http://fillsouthfirst.com/index.html

Noel Manley

Lisle school referendum to reduce taxes

Congratulations to the taxpayers in Lisle, school district 202.  You will be among the first to have a question on your ballot to lower your property taxes. The question that will appear on your April 2, 2019 Consolidated election ballot will be:

 

Shall the amount extended for educational purposes by the Lisle Community Unit School District 202 be reduced from $19,062,127.15 to $17,155,915.00  for the 2018 levy year, but in no event lower than the amount required to maintain an adequacy target of 110%?

Continue reading “Lisle school referendum to reduce taxes” →

Proposal to save taxpayers $6.2M

[Open letter to] CUSD 200 Board members,

Congratulations, Wheaton-Warrenville District 200 voted to build a new Jefferson preschool without raising taxes.

D200 said it could fund the project from operating revenue.  So tell me, why is the district still planning to use 20-year “lease certificates,” which will cost the taxpayers $6.2M more than necessary?   These tax dollars should be paying for educating students and maintaining our buildings rather than funneling them to consultants and out of state lenders.

Estimated Cost of building a new Jefferson

Based on estimates in Legat Architects 7/10/2018 presentation & the construction bids from August 2018:

  • $15M Construction Cost
  • $1.3M Architectural & Engineering (at least $600,000 already paid)
  • $1.3M Post Construction
  • $17.6M Total cost ($17M remaining)

In 2018 the district had planned to use a 20-year “lease” to avoid the referendum.  We assume using the same debt structure would result in the same interest payments of $6.2M. (See attached debt schedule from an Oct 2018 FOIA : 20yr Lease Certs CM Est Debt Service Schedule.shaw.10.19.2018.2).  The interest may actually be higher as interest rates are trending up.

Details – “Lease Certificates” & their risk:

At the 1/17/2018 board meeting, Bob Lewis of PMA presented the lease Certificate agreement including potential risk to using a “lease” for funding.  He starts speaking at 1:57:00  youtu.be/wC9gRv3tTVM?t=1h56m35s.

 From page 6 of his presentation:

Potential risks of lease financing

  • The payments are paid from operating funds which could squeeze other operating expenditures over time.
  • A change in the law prevents the District from taking ownership of the building once construction is completed and the lease is paid off
  • If a private entity is utilized as the lessor, there is a chance the property will be subject to property taxes
  • The lessor enters into bankruptcy

All of these risks still exist.

 

Furthermore, the “lease” you originally signed gave the building title to a third party for the duration of the “lease” despite the district having 100% of the risk, responsibility and authority for the building.  Why would you do this again when there is nothing to be gained by it?  As a reminder, I have attached section V or the law suit. Documented there, but not challenged in a court, a “lease” requires that a true lease exist; the “lease” as signed in March 2018 was a disguised bond sale. complaint sec V not true lease

Proposal to Fund from operating budget

The following fund-out-of-operating-budget-&-cash-reserves method is being proposed to avoid the $6.2M in interest payments.  You can plan to use Tax Anticipation Warrants* (TAW) to cover the cash flow shortage in April and May which is expected before the first installment of property taxes arrive in June.  (See attached historical cash flow for previous use of TAWs : Historical D200 fund balance).

Currently D200 has excess funds in cash reserves that can be utilized for Jefferson.  By cutting other spending, or using TAWs, D200 can find a few million more for a total of $17M to complete Jefferson funding in FY2019 & FY2020.  If you break ground in April or May 2019,… and plan to remove the existing building, pave the parking lot and landscape in the summer of 2020 after school lets out the building could open in August 2020 and be paid for with operating fund + reserves in two fiscal years with NO long term debt – a saving of $6.2M over the current “lease” proposal.

5-year forecast

Note: The 2018, 5-year forecast (attached : forecast5 10.19.1) includes the plan to pay for Jefferson via lease certificates.  Might I suggest that it be updated to include any known changes to revenue (e.g. new Amazon facility) or expenses, and then what-if Jefferson is paid for out of the operating budget and reserves as proposed above.

Schedule

The original timeline had 8/16/2018 Start Construction, and 8/21/2019 Occupancy.  So, my suggestion of waiting until spring of 2019 for ground-breaking and finishing by August 2020, in time for the next school year should be quite doable.  Rushing to complete it any sooner (January of 2020 was discussed at the November Board meeting) will add cost due to working in winter weather, logistical issues of moving equipment and classroom supplies over Christmas break, and the chaos of students being dropped-off and picked-up at a new building without the new parking lot and access roads being complete.

Attachments:

[linked here & inline when referenced]

__________

* Tax Anticipation Warrant (TAW) – a short-term debt security issued by a municipal government to finance current operations or an immediate project that will be repaid with future taxes.  District 200 used TAWs in 2009, 2010 and 2011.

Jan Shaw

School Bond Debt Drives Property Taxes

School districts need to keep borrowing so that they can spend today and tax tomorrow.  They think as long as they are not raising taxes much, we won’t notice.  But, we are paying attention.  When we approved the last referendums (Hubble, high schools…) those were to be paid off in 20 years – like a mortgage.  Instead, the school board has refinanced bonds to lower current payments and push the all-paid date out.  Then they borrow more – new, non-referendum bonds.  It is now more like a home equity line of credit that will never be paid off, so taxes will never go down.  Currently about 9% of our property tax bill pays for past school district borrowing.  If we STOP future bond issues our taxes will go down!

Vote “NO.”  Pay attention, don’t let them use your home equity to finance their spending.

From p7 of a PMA presentation to the District 200 board on May 9, 2018:

may 2018 pg 5 benefits of restructuring

Read that second line carefully.  They are restructuring bonds to create head-room for more borrowing that they hope no one will notice.  The 2018 restructuring has now been done.  The 2019 must be done, because it is the part that extends the debt.  Currently the repayment schedule peaks even higher!

The “CUSD 200, Financing Options for Refinancing/Restructuring” presentation was given on May 9, 2018, by Robert E. Lewis III, of PMA Securities, Inc.  See it: 2018_5_9 bond refinancing PMA

 

Finance Meeting

There is a finance meeting tomorrow, Nov. 6 at 3:30 pm at the school service center.  It is open to the public.

finance meeting 11_6_2018_notice

 

QA Jefferson with links for details

 

I will be voting “NO” despite the fact that everyone (me included) would like to say “yes” to a new Jefferson Early Childhood Center…

 

Bottom line:

District 200 cannot afford a new building without issuing new debt that will let them spend today while taxing tomorrow. The latest 5-year forecast, which does includes a new building, shows a $26 million deficit.  In recent years, the end-of-May financial report shows that prior to the first installment of yearly property taxes, the District’s money in the bank dips to around $15 million.  So while the referendum wording says “without levying a separate, special property tax,” they will need to find money somewhere.

Flyers

If you want to print something to share with neighbors, see:  https://dupagewatchdog.org/2018/10/vote-no-flyers-to-print/

Q/A:

1. Is a new Jefferson a “need” or a “want”?

  • The voters will decide.
  • posted 10/28/2018:  d200-pre-k-enrollment-cost/  (note: the grant programs for Head Start and the all-day Preschool Expansion grant (PEG) are not mandated.) 

2. How much will it cost vs. renewal of the existing building?

3. Can we afford it without raising taxes?

4. Is it our top priority given that 18 out of the other 19 building have a total “need” of $87 million in capital renewal?

5. If all CUSD 200 bonds were paid off how much would our taxes go down?

6. What has the school board been prioritizing, by already approving the spending?

7. How much, and who is paying for all the “vote yes” PR?

8. Why do we suddenly have a referendum? Has the district been telling the whole story?

 

originally posted 10/25/2018, updated 10/28/2018, & 10/31/2018