School bond committee mulls options
The Carson City School Board will likely seek a school bond in this year’s election. For how much and which projects, however, remain to be determined.
“We need to know what we’re going to do to secure our future as a school district,” Mike Mitchell told members of the district’s masterplan committee Thursday. “By the end of March at the latest, we need to have our act together. We can’t mess this up – what we do with 6,000 kids.”
Mitchell, the school district’s former operations director, was hired as a consultant to oversee the bond process.
The committee’s purpose is to determine the district’s priorities and how best to fund them, while not raising property taxes.
Why a bond this year is important
The Carson City School District has maintained a
47-cent bond rate since 1998. The three bond projects since then have remained tax neutral.
If no bond is passed this year, the tax rate would go down. However, a homeowner would probably not see a reduction in property taxes.
The likely result is that the city would absorb the difference into its operations budget, explained Marty Johnson, of JNA Consulting Group LLC, financial adviser on bond issues to the Carson City School District.
“The benefit of the reduction of the tax rate would not accrue to the taxpayer,” Johnson said. “It will just go to another local government.”
If the district reduces the tax rate now, it could not seek another bond in the future without raising taxes.
The masterplan committee is divided into subcommittees of finance, education, community relations and facilities. Each subcommittee created categories in need of improvement.
Mitchell said the draft list was created as if money were no object, what they would like to see happen in an ideal setting.
The draft list totals around $65 million. It includes items ranging from health and safety to code compliance and operational efficiencies to improving career and technical education.
Mitchell said the list needs to be pared down to absolute priorities, likely eliminating more than half of the projects. Different subgroups, he said, will have differing values but a consensus will need to be reached.
“We’re trying to do something that’s difficult,” he said. “Frustration is a part of that. I accept that.”
Once committee members narrow down a list of projects and it is determined how much money the district can borrow without raising the tax rate, members will then need to decide what kind of bond to seek from voters.
In the past, the Carson City School District has always sought a traditional bond, where there is a fixed rate and it’s authorized for six years.
Most other school districts in the state have opted for a rollover bond.
Johnson explained that a rollover bond is more selling a concept to voters rather than a particular project.
“We can borrow whatever we are allowed to within our existing tax rate,” he said. “It’s a 10-year window to issue those bonds.”
During a 10-year period, he said, the school district would borrow the same amount of money, but with the traditional bond it would have to go before the voters two to three times rather than just once with a rollover.
While a rollover bond may seem the best solution, Johnson said, the best bond is the one voters will approve.
School board trustee Stacie Wilke agreed.
“We can prioritize what we think is best for the education of our children, but it has to pass.”