Referendum on taxes

Districts roll the dice on $1.5 billion in tax increase measures

This story was updated on Oct. 15 to reflect final totals after the last deadline for putting measures on the ballot had passed. 

Will 2014 be the year that voters in Colorado school districts loosen up their wallets and approve well more than $1 billion in local tax increases for school construction and operations?

A year ago, voters were almost as skeptical of local proposals as they were of Amendment 66, the $1 billion K-12 statewide income tax hike that was defeated overwhelmingly. Hoping that voters are in a different mood this year, some two dozen Colorado school districts are seeking some $1.5 billion in property tax increases for construction projects and operating funds.

“On the bond side, it’s going to be the largest group of bonds that anybody’s ever seen,” said Tracie Rainey, executive director of the Colorado School Finance Project, which compiled the detailed list displayed at the bottom of this article.

This year’s ballot measures are interesting for several important reasons, including:

A big year – The total $1.4 billion request exceeds the nearly $1.2 billion districts proposed in 2012, although there were 38 measures on the ballot that year, compared to about 30 this year.

Boulder has biggest ask – The Boulder Valley School District is asking for a $576.4 million bond issue this year, exceeding the high set previously by the $515 million combined bond and override requested – and won – by Denver Public Schools in 2012.

Bond & Mill
  • Bond measures are voter-approved increases in property taxes for facilities needs. Districts sell bonds to raise the cash to pay for construction, then use the additional tax revenues to pay the bonds off.
  • Overrides are voter-approved hikes in a district’s general property tax rate that a district generally uses for operating expenses or special needs like technology purchases.

Five Adams districts asking – Most of the money – about $1.1 billion – is being requested from voters in just two counties, Adams and Boulder. Five districts in western Adams all are on the Nov. 4 ballot, an apparently unprecedented event.

Financial pressures – Despite a modest bump in school funding provided by the 2014 legislature, district leaders say that additional money is far from enough, and they have to ask voters for additional local revenues to cover building and program needs that can’t be put off.

A possible distraction – A statewide casino-expansion proposal, Amendment 68, is also on the ballot, and it promises more than $100 million in additional revenues for schools. District leaders are skeptical of A68’s promises and hope it doesn’t confuse voters about the need for local revenue. (Get details on A68 here.)

BEST off the ballot – For the first time in several years, 2014 ballots don’t include a long list of small districts seeking bond issues to raise local matching funds for Building Excellent Schools Today construction program grants. (There’s only one such local measure this year.) The state portion of that program has reached its ceiling for larger projects such as new schools and major renovations, so there’s no money for locals to match.

Chart

Voter mood – Finally, the 2014 election may provide an update on where some voters stand on school taxes. Voter attitudes have been on a roller coaster in this decade. District tax proposals received reasonable support in 2010, but 2011 was the worst year in memory for bonds and overrides. Voters were very supportive in 2012 but returned to their skeptical ways last year. Of course, voters rejected statewide proposals to increases taxes for schools in 2011 and 2013.

Boulder – the big ask

“This is a big ask, we understand that,” says Boulder Valley Superintendent Bruce Messinger when questioned about his district’s proposal for a $576.4 million bond issue. “It’s a hard choice.”

But, he added, “The facilities needs are not going to go away,” and if building systems begin to fail the 30,500-student district isn’t in a position to cover significant building costs from its general fund.

About half the money would be used to bring all district buildings “to acceptable standards,” he said, with the rest devoted to a variety of other needs. (See the district’s detailed facilities plan here.)

Boulder Valley Supt. Bruce Messinger / File photo
Boulder Valley Supt. Bruce Messinger / File photo

As is common with larger districts, Boulder went through a long planning and public consultation process before the board approved the ballot proposal in August.

Messinger said polling put the district’s overall approval rating is at “an all-time high” and that polling and focus groups indicate, “Taxpayers understand … schools are assets.”

While Messinger is feeling reasonably good about the proposal’s chances, he does note the possible of confusion with Amendment 68. “It’s a concern,” he said. “It’s on people’s minds.”

Boulder has had a history of success with its voters. It last lost an election in 2002, when voters rejected a $7.5 million override that would have funded technology improvements.

Adco’s “referendum” on school spending

Election history
  • Adams 12 – $9.9M override passed, $80M bond failed 2008
  • Adams 14 – $44M bond failed 2013
  • Adams 50 – $5.2M override failed 2013
  • Aurora – $15M override passed 2012
  • Boulder – $22.5M override passed 2010
  • Brighton – $4.8M override fail 2011
  • Cherry Creek – $125M bond, $25M override passed 2012
  • Colo. Springs 11 – $21.5M override failed 2008, $131.7M bond passed 2004
  • Dougco – $200M bond, $20M override failed 2011
  • Denver – $466M bond, $49M override passed 2012
  • Jeffco – $99M bond, $39M override passed 2012
  • Littleton – $80M bond passed 2013
  • Mapleton – $32M bond passed 2010
  • Poudre – $120M bond, $16M override passed 2010
  • St. Vrain – $14.8M override passed 2012

More information

While Denver, Douglas and Jefferson counties have but one school district each, Adams County is served by seven. Each district is considerably smaller than DPS or Jeffco, but combined the five largest districts in Adams had about the same enrollment as their neighboring counties did in 2013-14, about 85,000 students.

This year most Adams County voters have the rare opportunity to vote on school taxes at the same time. Those five districts – Adams 12-Five Star, Brighton, Commerce City (Adams 14), Mapleton and Westminster (Adams 50) – all have proposals on the ballot.

All but Brighton are seeking both bond issues and overrides for varying reasons. Each district is seeking bond money to upgrade existing buildings, while new schools would be built in growing parts of Adams 12, Brighton and Commerce City. Tax override revenues would be used to recruit and retain teachers, offset state budget cuts and cover a variety of needs. (See the spreadsheet at the bottom of this story for details on those district proposals and all tax measures statewide.)

Adams 12 Superintendent Chris Gdowski said the five sets of ballot measures weren’t coordinated but, “What’s driving it are common factors. We all have needs that haven’t been met.”

For Adams 12, he said, “The need is pressing, and we can’t wait any longer.”

Other county superintendent sounded the same note. “We decided to go this year because our needs just continue to mount,” said Mapleton Superintendent Charlotte Ciancio. “We have just been so far behind for so long … we just had to go.”

Westminster Superintendent Pamela Swanson said, “We’re trying to avoid any more cuts. We have some wonderful things happening, and we don’t want to take any steps backwards. We felt a moral obligation to go back out” to the voters, even though the district saw a $5.2 million override defeated last year.

Commerce City Superintendent Pat Sanchez had a bond issue defeated last year by about 300 votes. He called that a “hidden blessing” that forced the district “to be really crystal clear about what the voters are getting” this year. He and other Adams superintendents are hopeful that academic improvements in recent years will make voters more amendable to tax hikes.

Adams 12, Brighton and Mapleton are rated as “improvement” districts by the state accreditation system. Commerce City and Westminster are “priority improvement” districts but have moved up in recent years from “turnaround,” the lowest accreditation category.

Superintendents have varying answers about what happens if proposals are defeated. Gdowski said a loss could mean schedule changes in Adams 12. Sanchez said defeat “would change a five-year plan to a 10-year plan,” and Ciancio said, “If it doesn’t pass we’ll just have to keep going back to the ballot.”

Around the state

Two districts in El Paso County also have large measures on the ballot. Cheyenne Mountain is proposing a $45 million bond, and Falcon’s bond proposal totals $107.4 million.

Denver voters face a proposed sales tax increase and an extension for the Denver Preschool Program, which is separate from DPS. (Get more details here.)

There are no district proposals on the ballot this year in Denver, Douglas County, Jefferson County or in any of Arapahoe County’s seven districts.

State law bars school boards and districts from spending public funds on ballot measure campaigns.

The campaign load typically is carried by outside citizen campaign committees that raise money for brochures, yard signs and other materials. Such committees already have been formed in Boulder, in most of the Adams County districts and in Cheyenne Mountain and Falcon.

The bigger issue

Passage of bond issues and overrides in individual districts has the unwelcome side effect of increasing gaps between districts that have the political and financial capacity to pass them and those that don’t. (There’s a limit on district bond debt based on the value of property within a district, and there also are state ceilings on overrides.)

“The long range solution to this [school funding] is not doing this district by district,” Messinger said. “I worry that the gap [between districts] could widen over time,” said Gdowski.

But Sanchez, noting that there’s still a $900 million shortfall in state school funding, said it’s hard to districts to resist the pressure to raise their own money. “I think you’re going to see a trend of more bonds and mill levy overrides.”

This spreadsheet includes information gathered by the Colorado School Finance Project as of Oct. 6.

School Finance

IPS board votes to ask taxpayers for $315 million, reject the chamber’s plan

PHOTO: Dylan Peers McCoy

Indianapolis Public Schools officials voted Tuesday to ask taxpayers for $315 million over eight years to help close its budget gap — an amount that’s less than half the district’s initial proposal but is still high enough to draw skepticism from a local business group.

The school board pledged to continue discussions in the next week with the Indy Chamber, which released an alternative proposal last week calling for massive spending cuts and a significantly smaller tax increase. The school board rejected the proposal as unrealistic and instead voted to add a much larger tax measure to the November ballot.

If the school board and the chamber come to a different agreement before the July 24 meeting, the board can change the request for more taxpayer money before it goes to voters. Some board members, however, were dubious that they would be able to find common ground.

“While I appreciate the fact that we want to continue to negotiate, I’m pretty sure that I’m at rock bottom now,” said school board member Kelly Bentley. “That initial proposal by the chamber is, unfortunately in my mind, it’s insulting. It’s insulting to our children, and to our neighborhoods, and to our families.”

Chamber leaders, whose support is considered important to the referendum passing, were skeptical about the dollar amount. In a press release, the group said the district was “taking another step towards seeking a double-digit tax increase.”

“We’re concerned that our numbers are so divergent,” said chamber president and CEO Michael Huber in the statement. “We need to study the assumptions behind the $318 million request; clearly the tax impact is significant and the task of winning voter support will be challenging.”

During the board meeting, which lasted more than two hours, district leaders discussed why schools need more money and why the chamber report is unrealistic. They also took comments from community members who were largely supportive of the tax increase.

Joe Ignatius, who mentors students through 100 Black Men of Indianapolis, said that he has seen the benefits of more funding from referendums in other communities.

“This should be a no brainer, to invest in our future for the students,” Ignatius said. “Don’t think about the immediate impact of the dollars that may come out of your pocket but more the long-term impact.”

If the district goes forward with its plan, and voters approve the tax increase, the school system would get as much as $39.4 million more per year for eight years. A family with a home at the district’s median value — $75,300 — would pay about $3.90 more per month in property taxes. (Since the initial proposal, the district reduced the median home value used in calculations on the advice of a consultant.)

The district plan comes on the heels of months of uncertainty. After the school board abandoned its initial plan to seek nearly $1 billion for operating expenses and construction, district officials spent weeks working with the Indy Chamber to craft a less costly proposal. Last month, the board approved a separate referendum to ask taxpayers for about $52 million for school renovations, particularly school safety features.

But the groups came to different conclusions about how much money the district needs for operating expenses.

The chamber released an analysis last week that called for $477 million in cuts, including eliminating busing for high school students, reducing the number of teachers, closing schools, and cutting central office staff. The recommendation also included a $100 million tax increase to fund 16 percent raises for teachers.

District officials, however, say the cuts proposed by the chamber are too aggressive and cannot be accomplished as quickly as the group wants. The administration and board members spent nearly an hour of the meeting Tuesday discussing the chamber plan, why they believe it’s methodology is wrong, and the devastating consequences they say it would have on schools.

Even if the $315 million plan proposed by the district passes, it will come with some sacrifices compared to the initial plan. Those cuts could include: reduced transportation for magnet schools, field trips, and after school activities; school closings; increased benefits costs for employees; and smaller pay increases for teachers and employees.

The district did not make a specific commitment to how much teacher pay would increase if the amount asked for in the referendum is approved, but Superintendent Lewis Ferebee said the funds would pay for consistent raises.

“We would be at least addressing inflationary increases and cost of living, but we hope that we can be higher than that,” said Ferebee. “It would depend a lot on what we are able to realize in savings.”

The school board’s decision to rebuff the chamber’s recommendation puts the district in a difficult position. The chamber has no official role in determining the amount of the referendum, but it could be a politically powerful ally.

Last week, Al Hubbard, an influential philanthropist and businessman who provided major funding for the chamber analysis, said that if the district seeks more money than the group recommended, he would oppose the referendum.

The total tax increase would vary for each homeowner within district boundaries. The operating increase would raise taxes by up to $0.28 for every $100 of assessed property value, while the construction increase would raise taxes by up to $0.03 per $100 of assessed property value.

On school finance

Facing tax opposition, Indianapolis leaders may settle for less than schools need

PHOTO: Alan Petersime

One day before the Indianapolis Public Schools Board is expected to approve a ballot measure to ask taxpayers for more funding, district officials appealed to a small group of community members for support.

Fewer than 40 people, including district staff, gathered Monday night at the New Era Church to hear from leaders about the need for more school funding. School board members plan to vote Tuesday on whether to ask voters to approve a tax hike to fund operating expenses, such as teacher salaries, in the November election. But just how much money they will seek is unknown.

The crowd at New Era was largely supportive of plans to raise more money for district schools, and at moments people appeared wistful that the district had abandoned an early plan to seek nearly $1 billion over eight years, which one person described as a “dream.”

Martha Malinski, a parent at School 91 and a recent transplant from Minneapolis, said the city appears to have a “lack of investment” in education.

“Is the money that you are asking for enough?” she asked.

Whatever amount the district eventually seeks is likely to be dramatically scaled down from the first proposal. Superintendent Lewis Ferebee has spent more than seven months grappling with the reality that many Indianapolis political leaders and taxpayers don’t have the stomach for the tax increase the district initially sought.

“We are trying to balance what’s too much in terms of tax burden with the need for our students,” said Ferebee, who also raised the possibility that the district might return to taxpayers for more money if the first referendum does not raise enough. “If we don’t invest in our young people now, what are the consequences and what do we have to pay later?”

After withdrawing their initial plan to seek nearly $1 billion over eight years, district officials spent months working with the Indy Chamber to analyze Indianapolis Public Schools finances and find areas to trim in an effort to reduce the potential tax increase. But the district and chamber are at odds over how aggressive the cuts should be.

Last week, the chamber released a voluminous list of cuts the group says could save the school system $477 million over eight years. They include reducing the number of teachers, eliminating busing for high schoolers, and closing schools. The chamber has paired those cuts with a proposal for a referendum to increase school funding by $100 million, which it says could raise teacher salaries by 16 percent.

District officials, however, say the timeline for the cuts proposed by the chamber is not realistic. The analysis mostly includes strategies suggested by the district, said Ferebee. But steps like redistricting and closing schools, for example, can take many months.

“Where we are apart is the pace, the cadence and how aggressive the approach is with realizing those savings,” he said.

Not everyone at the meeting was supportive of the administration. Tim Stark, a teacher from George Washington High School, asked the superintendent not to work with charter high school partners until the district’s traditional high schools are fully enrolled. But Stark said he is still supportive of increasing funding for the district. “It is really important for IPS to get the funds,” he said.

The chamber has no explicit authority over the tax increase but it has the political sway to play an influential role in whether it passes. As a result, Indianapolis Public Schools officials are working to come to an agreement that will get that chamber’s support.

A separate measure to fund building improvements was announced by the district in June and incorporated into the chamber plan. That tax increase would raise $52 million for building improvements, primarily focused on safety. That’s about one-quarter of the initial proposal.