"If the folks want the long term debt, if they enjoy burning tax money, so be it. You folks out there that know we don't need new phone systems, new secure entrances, new card readers, etc., read the scope .... The bond language mimics other districts. True necessity would include nothing unnecessary. The pensions are underfunded - and now you get to help make it up. The school will not close. The school receives PLENTY of money per student, and that will not stop. If you folks don't vote, if you don't spread the word, a few will decide the district debt for all."
~ Via Tab Faber
Screen shot from http://www.beavertonone.com/how-did-we-get-here
Take a look at this graph, specifically at 2010-11.
If you divide the red expense column by the number of students, you get a cost per student of $8507.00. Then if you go to 2014-15, where it is projected we will be a deficit district, the cost per student jumps to $9210.00.
If the cost per student was maintained from 2010, this graph would look much different:
We'd actually have a small surplus.
" - $9,210.00. Per student x a class size of 25 = $230,250.00 per class. Should that be enough to teach kids the fundamentals of reading, writing, and arithmetic to prepare them to be productive citizens?"
We would say the increased costs are likely tied to labor, and one official admitted that the state-mandated pension contribution has risen considerably. A 30-year bond extension will have little affect on the health of the school if the cost per student continues to climb and the student population continues to fall.
The sales pitch for the bond extension is one based on financial necessity. The B1 did a good job of creating a power point presentation explaining the dire position of the school district, how we got there, and the repercussions of missing what they term a "once in a lifetime opportunity." (For some of us, that is a correct assessment. The proposed language right now is a 15-year extension. Many on the B1 may not be with us when the bond sale is satisfied in the year 2029.)
But while the well-meaning B1 committee is focusing on not increasing the rate at which citizens in the district are taxed, there seems to be no focus on the long term debt of the district.
We get it - a financial infusion will buy time to allow the school district to make the cost per student match revenue, and we really do need to hear how they propose to do that or this bond extension is a non-issue.
Screenshot from http://beavertonone.com
This progression of circles makes a good argument for not assuming any long term debt at this time. The prudent thing to do is only spend what is required to make necessary repairs until enrollment and revenue stabilize. A few years from now we don’t want to have to add a circle for “take on debt,” and another for “bankruptcy,” to the How Did We Get Here? wheel of misfortune.
Bill Lang put it best during the Beaverton Bond Extension Open Forum:
"...you've got declining customer base, declining revenue, and at this point, you want to borrow a huge sum of money. That is the same path that Detroit and Flint and all these places - Pontiac - in so much trouble...that is what they did. It would seem to me . . . that we might better go with that sinking fund, fix the roofs, get the parking lot and stuff in shape... and we can do that a lot cheaper with that sinking fund than we can with a bond, and give the administration time to get the expenses in line with the enrollment."
Oh come on folks, it's time hold discussions. Feel free to do so on any of our blogs.
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