Did you receive a "Vote NO" referendum flyer this week? I did.
The group "Concerned WFB Voters 2009" (hereafter called CWFB) is suggesting that the School District is, well, trying to bamboozle voters by claiming the cost of the referendums are actually much higher than written.
This accounting piques my interest, so I decided to investigate and write.
I am not associated with either the "YesYes" group, the Advocates for Education, nor the CWFB group. I have, however, lived in Whitefish Bay 12 years, all the while paying into the School District while not having children attend.
What I've found is that .. CWFB gets credit for raising some issues, although the presentation tends to scare more than inform.
First up, the "Concerned WFB" group suggests the Referendum questions are somehow falsely suggesting pricetags of $9m and $13.6m because of the cost of interest on the borrowed money.
The referendum on the ballot grants the District the ability to issue "general obligation bonds in an amount not to exceed $9m.." and $13.6 for the second item.
Question: Did anyone think those bonds wouldn't have an interest cost?
School District estimations assumed a worst-case scenario of 5.5% bond interest. -- Notice how mortgage rates are at historic lows? Guess what .. so are municipal bond rates. You can see the recent bond trades for the WFB District here.
Actually, if you ever wanted to borrow money for public improvements, now would be that time.
And here's an unmentioned bit: There is a decent chance the WFB District will luck out with a zero interest loan from the US Government, thanks to stimulus packages.
Back to the flyer:
This is true and false. It is absolutely not "unforeseen." It is a given fact that the School District knows full well about, and has included in all calculations. Property "rich" districts lose aid when they raise money through referendum, and for Q2, the District has calculated that they will lose $5m of aid over time.
(There is some irony that the CWFB flyer uses a figure calculated by the School District, yet calls it an "unforeseen consequence.")
Here are the facts:
In the next year, District debt is retiring that costs taxpayers about $125/year in taxes on a $350k house. For question 1, the District is asking for $9m in new debt for maintenance projects to replace that debt.
- If Q1 is voted down, and you own a $350k house, your property tax will decrease $125/year. Yes, you can vote yourself a tax cut, plain and simple.
- If Q1 is passed, your property tax for schools will remain unchanged, as it will go down $125, then up $125, which is a wash. That's the way Q1 was designed.
The CWFB group suggests the above is "misleading." Personally, I don't find it complicated.
For question 2, the District is asking for $13.9m in new debt for maintenance projects.
- If Q2 is passed, your property tax for schools will increase $248/year on a $350k house.
It's important to note that is a WORST-CASE scenario, since the School District used 5.5% as their bond interest rate, which is literally a maximum. Could be 4%, could be 2.5%, could be 0%.
In these estimates, the District has INCLUDED the cost of the project, the debt, the interest, AND the lost state aid. -- Suggesting otherwise is disappointing political fluffery.
There are indeed good reasons to vote for and against the referendums. You might consider it too personally costly, or too risky, or unnecessary. You might not have children in the public school system.
My advice is to read and understand, get the facts online or in person, and make your own judgment call, based on your own political and financial position. Decide whether you want maintenance performed on the schools for Q1, the improvements in Q2, and how that fits in with your pocketbook and personal outlook concerning our schools.
Or you can find out in person .. there've been almost a dozen public forums and there's one more: October 27th, 7pm, in the Middle School Media Center.