State Funding vs. Property Taxes: Why We Need 3A and 3B

Have you found yourself thinking about how your property taxes were higher this year and wondering why school districts across Colorado, including Jeffco Schools, are asking for more money in mill and bond requests like 3A and 3B?

We have answers. Read on!

Believe it or not, both of these things are true:

  1. Property taxes in Jeffco increased due to increased home values in the area.
  2. State school funding remained largely flat.

In Jeffco, state funding for the 2016-17 year increased 1.2 percent over 2015-16 funding, as reported in Jeffco’s 2016-17 Dollars and Sense brochure. Inflation, however, has been measured at 2.8 percent on the Front Range and is predicted to be at 2.6 percent this year.

When we say state funding has remained “largely flat” what we mean is that sometimes — such as this year–it isn’t even keeping up with inflation, which means less money for classrooms, for maintaining facilities, and for keeping pay competitive.

What’s worse is that even though the housing market is booming and taxes are up, the Denver Post reported last month that 2017-18 budget cuts may be on the way:

Colorado’s state budget faces a potential deficit this fiscal year, economic forecasters told state lawmakers Tuesday, as tax revenues continue to fall short of previous expectations.

If true, that would mean cuts to K-12 funding for 2017-18, and potentially mid-year cuts this year.

Let’s repeat that: despite a booming economy and increased property taxes, Jeffco Schools could see mid-year budget cuts this year.

That was the news a week ago. A few days ago Chalkbeat report Nic Garcia tweeted that the state budget chief now thinks that won’t happen. However, we won’t know more until the budget forecast is released at the beginning of November.

Here’s how school funding can remain flat even though your taxes increased:

StateLocalfunding

It’s pretty simple: the state uses more of your local taxes to fund your schools and decreases their share to use elsewhere in the budget. Mill levy override funds, on the other hand, aren’t part of the equation. All money from 3A and 3B stays in Jeffco and puts additional money in all our schools — charter, option, or neighborhood — and does so equitably. All students benefit.

Money from 3A becomes part of the operating budget; money from 3B is specifically for facilities, including capital maintenance, new construction, and school additions.

This chart that shows Jeffco’s state funding for the past several years. Note that 2016-17 funding is a mere $167 more than it was in 2009-2010.

statefunding

If state funding was keeping up with inflation, our students should be receiving $7,956 this year — $719 more than actual funding levels.

That’s why school funding needs a grassroots effort — in this case, 3A and 3B.

This graphic shows the difference that mill levy override funding makes for students. Boulder and Denver voters have approved many more 3A dollars for their students, which means their districts have more dollars for the classroom every year.

fundingcomp

Also, we’ve seen some crazy posts complaining that money from 3B isn’t being used to target student achievement. First, the law dictates that 3B money has to be used for facilities. Second, students learn better when they’re not being distracted by cold air from drafty windows, chilly classrooms from outdated HVAC systems, or water dripping into a bucket in their classroom because the leaky roof hasn’t been fixed. It’s just common sense.

A few other points:

1.  Yes, it would be nice if the state would get rid of the negative factor and restore that money to schools. But it hasn’t happened despite intense lobbying from Colorado’s superintendents, advocacy groups like Great Education Colorado, and individual citizens.

Instead, more cuts are predicted. Are we content to sit by and watch our school budgets get slashed again, or can we do better for our students? Our answer: by voting Yes on 3A and 3B Jeffco can do better.

2.  Marijuana money won’t dig us out of the funding hole. In fact, Jeffco isn’t receiving any pot tax. It isn’t and won’t help us with the current issues.

3.  Last, don’t forget that there is a cost to doing nothing in Jeffco. The leaky roofs won’t miraculously repair themselves. The cost to educate students and maintain our facilities won’t decrease if we choose to ignore it. We’ll talk about that more in another post.

Want one more reason? Watch Jeffco Economic Development Corporation Chair David Jones explain why the JEDC endorsed 3A 3B:

Please vote Yes on 3A and 3B, and then get those ballots in. Use this graphic to encourage others to vote by Nov. 8.

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JeffCo Proud!

Myth-Busting the Jeffco Schools 3B Bond

As we’ve explained in previous posts, voters are being asked to approve mill levy override and bond issue on this fall’s ballot, known as 3A and 3B. We’ve seen a lot of false statements by the anti-tax crowd that opposes it, so today we’d like to separate fact from fiction regarding the bond.

LogicFail

Myth: 3B will increase the amount residents pay in property taxes in 15 years.

Fact: This bond is structured like recent previous bonds, such as those in 2004. It is a 25-year bond and the financial piece has been organized to make sure the burden to the taxpayers is consistent throughout the next 25 years.  

Those perpetuating the myth that the costs will go up have forgotten that Jeffco will pay off previous bonds during this time period, which will allow them to keep the cost to taxpayers the same, whether taxpayers are paying their taxes next year or in twenty.

Myth(s): Too much (or not enough) of the bond is being allocated to new schools. Too much (or not enough) of the bond is being allocated to Jeffco’s maintenance backlog. Too much (or not enough) of the bond will be used for additions to existing schools.

Fact: The bond balances the district’s need for new schools in growing areas of the county, with the ability to create efficiencies by adding classrooms to some existing buildings rather than construct entirely new schools.

The reality is that in some areas, more classrooms at an existing school will address our students’ needs, while in other areas — particularly those that were mere fields back in 2008 — need an entirely new school. All of our existing schools also have maintenance needs, and part of the bond will also be used to address the most critical needs.

Myth: All sorts of bond money will be wasted on fees and overruns.

Fact: Any good bond will be structured so that the projects in the bond won’t exceed the value of the bond.

If you’ve done any kind of major renovation of your house, you know that the initial cost estimate is just that: an estimate. The cost of construction materials alone has skyrocketed in Jeffco in the past years as building has boomed, and those costs also affect any construction and maintenance done to our schools.

If the bond didn’t include contingency dollars and the cost of supplies inflates even more, either the school would be forced to come back and ask for more money to complete the promised projects, or they’d have to tell certain communities, “sorry, we wanted to do that but we ran out of money.”

Structuring the bond to account for inflation and to make sure that projects will not exceed the bond amount is smart financial planning — and the reason that the Jeffco Schools Financial Oversight Committee encouraged the school board members to put 3A and 3B on the ballot.

Myth: This is a “billion dollar bond.”

Fact: This is a $535 million bond and calling it anything else is just plain silly.

A bond is a lot like a mortgage. Schools borrow the amount they need, and they pay it back with interest. If you borrow $80,000 for a mortgage, you call it an $80,000 mortgage even though you’ll pay much more than that with interest. 3B isn’t any different.

The district has typically included the entire payback amount in the ballot language. While we agree that the payback amounts are shocking to see (and for that matter, think that about car payments and our own mortgages too!), there’s nothing unusual here.

As a comparison, the 2012 ballot for the voter-approved $99 million warm, safe and dry bond read as follows:

SHALL JEFFERSON COUNTY SCHOOL DISTRICT R-1’S DEBT BE INCREASED $99 MILLION WITH A MAXIMUM REPAYMENT COST OF $195 MILLION OR SUCH LESSER AMOUNT AS MAY BE NECESSARY, AND SHALL JEFFERSON COUNTY SCHOOL DISTRICT R-1’S TAXES BE INCREASED $19.8 MILLION ANNUALLY OR SUCH LESSER AMOUNT AS MAY BE NECESSARY FOR THE PAYMENT OF SUCH DEBT …

Here’s the language in this fall’s ballot:

SHALL JEFFERSON COUNTY SCHOOL DISTRICT R-1’S DEBT BE INCREASED $535 MILLION WITH A REPAYMENT COST OF $987.22 MILLION OR SUCH LESSER AMOUNT AS MAY BE NECESSARY, AND SHALL JEFFERSON COUNTY SCHOOL DISTRICT R-1’S TAXES BE INCREASED $72.6 MILLION ANNUALLY OR SUCH LESSER AMOUNT AS MAY BE NECESSARY FOR THE PAYMENT OF SUCH DEBT….

Let’s compare them.

2012

  • $99 million bond
  • Total payment to not exceed $195 million

2016

  • $535 million bond
  • Total payment not to exceed $987.22 million.

The repayment is similar, except in 2016 the district is able to make a better deal thanks to low interest rates. If this bond was structured the same as the 2012 $99 million bond, it actually could have had a total payment that is $71.56 million more.

We’re no math whizzes, but we think saving more than $71 million by borrowing now is a pretty good deal.

The 3B bond is a strategic, thoughtful decision that will allow Jeffco to repair, update, and build well-maintained schools for our students. We encourage you to vote Yes on 3A and 3B and hope you will encourage others to do the same.

Have you voted yet? If not, remember that you can drop off your ballot at any of the county’s drop boxes, send it by mail (though use 2 stamps just to be on the safe side.

Every vote counts, and we hope you will support 3A and 3B. Please also help us get out the vote by encouraging others to turn in their ballot and then use this fabulous profile picture to encourage even more voters to turn their ballots in too. Thank you!

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JeffCo Proud!

Jeffco 3A & 3B Basics: Understanding the Bond

This is the second post in our series on understanding why the Jeffco School Board is asking for a mill and bond this year. Today’s post focuses on 3B, the bond.

How did we get here?

First, we’ll remind you that funding – or lack thereof – has been the biggest challenge for a number of years. You may remember this graph:

NegativeFactorWithout the negative factor, Jeffco Schools would have received $481 million more from the state during the past five years. Instead, Jeffco has been making do with less, while simultaneously petitioning legislators to reduce the negative factor and put that money back into schools. In real terms, this means we’ve been deferring maintenance, and that backlog is growing.

In addition, although Jeffco home values are at an all-time high, the resulting increase in your property taxes has not increased Jeffco’s funding. Instead, the state puts more of those taxes into schools, but then takes an equal amount of state funds to use elsewhere in the budget, as you can see in the graph below.

StateLocalfundingMill levy override funds are different. They stay in Jeffco and lead to increased per-pupil funding.

In 2012, we passed a $99 million bond to address the most urgent facilities needs like new roofs, HVAC systems and more. Those needs have been addressed — on time and within budget — but they only fixed Jeffco’s Tier 1 needs. We still had hundreds of millions of dollars of Tier 2-5 needs for our schools and facilities, and even more urgent maintenance issues have built up in the last four years.

Part of the issue is that our schools are, on average, 45 years old. Plumbing, roofs, HVAC systems, windows, fire alarm systems, and more are aging and need to be replaced. Every single school in Jeffco needs some sort of maintenance.

You’ve probably also read that Jeffco Schools was testing for lead in school pipes recently. They found lead that exceeded federal standards in about 8 percent of the fixtures tested so far. Jeffco Schools is now taking steps to fix this, but it’s another indication that our schools are aging, and we need funding that can adequately address these critical maintenance issues.

What will the bond do?

  • Upgrade old schools with updated security systems
  • Provide new schools in areas where Jeffco is growing. Our school district has not had a bond to fund new construction since 2004 when voters approved a $323.8 million bond.
  • Allow the district to address the repair backlog of leaky roofs, faulty wiring and more by improving, updating, and repairing 110 schools, including updating technology and lab spaces.
  • Renovate and construct additions at 45 schools and facilities to add more classroom space
  • Replace four current aging facilities
  • Construct three new elementary schools.

You can read more about the bond outline here and read the final facilities master plan here.

Want to know how your school will benefit? Jeffco Schools has an interactive web page that allows you to access information about your child’s school, schools in your neighborhood, and schools that you might be considering in the future.

This is also a good time for the district to consider a bond. Bond interest rates are some of the lowest we’ve seen in the last several decades, making this a cost-effective time to borrow.

We’ve also heard people asking why we can’t just convince the state to provide more funding. The short answer is that we’ve petitioned our legislators to do just that for many years, session after session, and it’s not happening. Superintendents around the state have advocated, as in this 2014 letter.

This year, the superintendents sent another letter, and a rally was held at the state capitol where superintendents and school supporters alike filled the room to show support. This writer was at that rally. It didn’t work.

Eagle Schools Superintendent Jason Glass summarized the issue nicely in a recent column: 

To make a long story short, this “negative factor” cuts nearly $1 billion from Colorado’s schools annually and accounts for an accumulated $40 million in cuts to [Eagle County schools] alone.*

I’d like to say that Colorado is on its way toward restoring these cuts. Alas, the cavalry is not on the way from the state. The plain, cold reality is that without a local solution, our schools will never return to pre-recession levels.

*JCSBW note: that amount is about $80 million per year in Jeffco, for an accumulated $481 million in cuts so far.

What we can — and must — do is create our own solutions. In Jeffco, the cost is reasonable: $4.12 per month for every $100,000 of home value. For a $300,000 home, that’s about $150 a year to fund our school facilities and programming, and protect our home values.

We can support our Jeffco students by providing safe, well-maintained classrooms and buildings. We can make sure our Jeffco Schools continue to be some of the best in the area. We can make a better future for our students and our community.

3A3B

Also don’t forget to head over to Support Jeffco Schools to volunteer to help the Yes on 3A/3B campaign if you haven’t already.

JeffCo Proud!

 

Jeffco 3A & 3B Basics: Understanding the Mill Levy Override

3A3B

This fall, we’re going to post a series of articles explaining the basics of the mill levy override and bond, 3A and 3B, so you can understand how the board members came to their decisions. We support both measures.

Today, we’d like to spell out the basics of 3A, the mill levy override.

Funding — or lack thereof —is the primary driver. The short version is that state funding is a big challenge. Due to the negative factor, Jeffco Schools has received $481 million less from Colorado than was supposed to be budgeted.

NegativeFactor

Jeffco is also not receiving any of the marijuana money that was budgeted. That’s going to other districts, mostly small and rural, for facility maintenance and construction.

Several forecasts also suggest Jeffco Schools could be facing more cuts for 2017-18. If that happens, 3A dollars will be used first to backfill those cuts and maintain programs.

The mill levy override, 3A, would provide an additional $33 million in funding that would benefit all Jeffco Schools: neighborhood, option, and charter.

It will be split so that Jeffco neighborhood and options schools receive $29.7 million, and charter schools receive 10 percent, $3.3 million. Those numbers mirror the percent of Jeffco students enrolled in neighborhood, option, and charter schools.

If state funding remains stable, the $33 million will be used to expand learning opportunities, update security, and to retain and attract excellent teachers. Here’s what the board prioritized in their meetings this summer:

  • $12.6 million – compensation to retain and recruit excellent teachers
  • $3.7 million – mental health support for schools, including a half-time counselor at every elementary school
  • $800,000 – additional support for security and emergency management, including increasing personnel, supporting ongoing crisis prevention and intervention training programs, support supplies, and software purchases
  • $12.2 million – increased Student Based Budgeting funding in all schools, including extra support for small schools who are challenged by the current SBB process. This will allow schools the flexibility to enhance education for their students.
  • $400,000 – increased support services, like the additional custodians and supplies that will be needed when the new schools open, and additional district building techs
  • The remaining $3.3 million will go to charter schools, whose boards will decide how to allocate the funds to enhance teaching, programming, and more.

You can read more about the mill levy override priorities here and read the full ballot text here.

Together, 3A and 3B will cost $4.12 per month for every $100,000 of home value. For a $300,000 home, that’s about $150 a year.

We’ve waited a long time for state funding to bounce back after the economy recovered. Unfortunately, it looks like it’s not going to happen.

Now we have a choice. We can create our own solutions and vote to support our Jeffco students in safe, well-maintained classrooms and buildings. We can vote to provide funding that allows us to attract and retain excellent teachers. We can make a difference.

Vote yes on 3A and 3B, and remember to tell your friends. Spreading the word on your social media of choice also helps, so please share this post.

We’d also like to remind everyone that the Yes on 3A and 3B campaign need volunteers to help in the coming weeks, as well as donations to help pay for signs and other campaign materials. If you can help, please head over to the Support Jeffco Schools website and sign up there.

Jeffco Proud!

Jeffco Schools mill & bond will be on November ballot

Our original post noted that the increase would be $3.50 per $100,000 assessed value. That number was based on previous projections, so we’ve corrected the numbers in this post to reflect what was approved on Tuesday night: $4.12 per $100,000.

On Tuesday, the Jeffco School Board approved a motion to put the mill and bond on the November ballot. The ballot question will ask voters to approve a bond package totaling $535 million dollars, and a mill levy override of $33 million.

Your Childs Education

Also note that we’ve seen some suggestions that this is a “billion dollar bond,” mostly from groups that have struggled in the past to grasp basic math concepts about the Jeffco Schools budget. This is a $535 million bond — just over half a billion — to address aging facilities and fund new construction.

Our friend Tina Gurdikian sent out a newsletter about the topics, and agreed to let us reprint it to explain more about the mill and bond. We’ve cut some portions that refer to the then-upcoming Tuesday meeting.

“Architects of Our Own Solutions” – Jeffco BOE Treasurer, Brad Rupert said this at tonight’s board meeting and I jotted it down ’cause I thought – that pretty much sums it up for me too. We can’t sit back and wait for the state to come through with the funding we need to provide an education for our kiddos that prepares them to be college/career ready. It’s way too late for that, and it just simply isn’t going to happen. Since 2009, when the “negative factor” was implemented, Jeffco Schools have missed out on ~$490 MILLION – and we don’t see an end to the negative factor any time soon, unfortunately. So what are we going to do about it? We are going to be architects of our own solutions!!

Here are a few of the details of the proposed bond issue:

  • This is an “extremely favorable interest rate environment” – meaning we can get an excellent interest rate. Typically when you buy a home, you’re told that the actual principal/interest you’ll pay over the life of your loan is 2-3 times the cost of the home. Jeffco can get a rate such that our principal/interest payments are less than 2 times the principal for a term of 25 years.
  • This would be a $535M bond with a maximum principal/interest repayment of $987.22M – with a not-to-exceed annual principal/interest payment of $72.6M annually in any given year.
  • Essentially we are looking at 4 primary priorities with this bond package:
    • Priority 1 – K-5, 6-8 grade reconfiguration
    • Priority 2 – growth and/or equity
    • Priority 3 – efficiencies
    • Priority 4 – deferred maintenance
  • What do these priorities mean exactly? You can see the breakout of the proposed capital improvement projects by area and school here so you can see the direct impacts to your children’s schools.

What about the $33M mill levy override? The mill levy override (MLO) is an annual increase to address operational needs (as a result of the negative factor and decreased funding in per pupil revenue from the state), whereas the bond addresses capital/facilities needs. Page 4 gives a great description of the needs to be addressed by the MLO, but I’ll sum up:

  • $12.6M – to retain and attract the best and brightest teachers, administrators and staff
  • $3.7M (this is something I feel so strongly about) – to provide a half-time counselor for every elementary school
  • $800K – for security and emergency management
  • $12.2M – increase student-based budgeting (SBB) dollars to schools, especially smaller school hit the hardest by SBB.
  • $400K – additional support services needed for the new school at Candelas
  • $3.3M – charter school dollars for compensation, curriculum, technology, etc. (10% of the MLO)

So what does this mean for you and your bottom line? Support Jeffco Kids broke it down for us. Per $100,000 of assessed home value, this bond package and MLO – combined – would cost you…$4.12/month. That’s right – if you’re home’s value is $300,000, you’re looking at an increase of $12.36 month.

This is how I, personally, see this. Our daughters swim. A lot. And if your child has ever been on a swim team, you know that breakfast burritos are what EVERYONE eats at a swim meet – considering these crazy summer meets start with warm-ups at 6am! Our team sells burritos for $3.50 each. So to me, it’s like buying a few breakfast burritos a month, right? Are my kids worth it? Heck yeah!

Are your kids worth it? Heck yeah! Remember, it takes a village to raise a child – we are all in this together – whether you have kids or grandkids or none at all, the value of excellent public schools is priceless for a community! Seriously!

Support Jeffco Kids has been really busy this summer. Please check out the following articles they’ve published recently, which shed additional light on some of the issues around the need for the mill/bond:

Lead Contamination?

While I’m talking about facilities needs, let me touch on the other topic of discussion at tonight’s board meeting – contaminated drinking water. Jeffco staff have been very busy this summer testing fixtures in our schools for lead contamination.

Since June 3, the district has tested 80 elementary schools and drawn ~3,500 samples in an effort to ensure drinking water in our schools is safe for our students, staff and parents. By the time school starts, all elementary school fixtures in buildings built before 1990 and all water fountains in elementary schools built after 1990 will have been tested.

Any fixtures found to exceed the 15 parts per billion EPA limit for Lead will be deactivated or labeled “Do Not Drink” depending on the level of Lead detected. While testing of middle and high school fixtures will not be complete by the start of the school year, district staff will work with principals to get the word out to parents to let them know the status of the testing. Bottled water may be provided at older facilities where fixtures have a greater probability of higher Lead levels.

Again, just another example of the types of maintenance district staff face with our aging facilities. 

 

We’ve waited long for additional state money, and it’s not coming. Jeffco needs to find its own solutions to long-deferred maintenance issues and so much more.

 

Let’s continue to be

JeffCo Proud! Keep fighting, JeffCo!