Bond Planning Subcommittee Meeting 3: December 11, 2019 Meeting - - PowerPoint PPT Presentation

Bond Planning Subcommittee

Meeting 3: December 11, 2019

Meeting Agenda

• Meeting 2 Recap
• District Financial Overview & Bond History
• Bond Planning Process
• Overview of Facility Assessment and Schedule
• Defining Consensus

Meeting 2 Recap

In Meeting 2…

We discussed:

• Facility Tour Reflections
• Take aways
• Surprises
• Challenges
• Older vs. newer comparisons
• Features of Quality Schools
• School Transformations
• How has the world changed since you were in high school?
• What do students need to know and be able to do in order to be contributing member of society?
• What types of experience should a student have that would prepare them for long term success?
• What type of spaces fit Victoria?

House Norms

• Everyone participates – no one dominates
• Begin and end on time
• Take personal breaks as needed
• Respect all opinions

District Financial Overview

School Finance: The Big Picture

A school district’s budget is generated from three sources:

• Federal funding
• State funding
• Local tax effort

Federal State Local

2% 2% 50% 50% 48% 48%

Federal Funding

• Appropriated for special programs or

to provide services to a specific group of students

• Cannot be used to replace state or

local dollars to fund a program (supplanting)

• About half of federal funds go

directly to school districts

• The remainder goes to the State

Federal State Local

2% 2%

State Funding

Foundation School Program

• Provides state funding to school districts
• Administered by TEA
• Meant to ensure that all school districts,

regardless of property wealth, receive “substantially equal access to similar revenue per student at similar tax effort, considering all state and local tax revenues

• f districts after acknowledging all

legitimate student and district cost differences.”

Federal State Local

50% 50%

Local Tax Effort

• Generated from property taxes (not sales taxes)
• Victoria Central Appraisal District sets taxable

home values

• Called “ad valorem” taxes
• Each year, a school district adopts two tax

rates, which determine the total tax rate:

• Maintenance & Operations

(M&O – aka general fund)

• Interest & Sinking

(I&S – aka debt service)

20.33% $77.7 MM

Federal State Local

48% 48% M&O I&S

Maintenance & Operations (M&O) Tax Rate

Funds the day-to-day maintenance and

• perations of the district
• Salaries (for teachers and other staff)
• Facility repairs and maintenance
• Bus repairs, maintenance and fuel
• School supplies and materials
• Utilities (electricity, water, etc.)

For the average age citiz izen en this is is simila milar to:

✓ House repairs ✓ Car fuel ✓ Routine services ✓ Groceries ✓ Cleaning Supplies ✓ Utilities

Interest & Sinking (I&S) Tax Rate

Funds debt repayment for “big ticket” items

• New building construction
• Existing building renovations
• Land purchases
• Program-specific equipment
• Technology
• School buses

12

For the average age citiz izen en this is is simila milar to:

✓ New home purchase ✓ House renovations ✓ Land for a home ✓ New appliances ✓ New home computer ✓ New car

I&S (Debt Service) Funding

What at is a a bo bond? nd?

A bond is a debt investment in which an investor loans money to a school district, with interest, for a defined period of time. Essentially, it’s similar to a family taking out a mortgage for the purchase of their home. School districts issue bonds to pay for “big ticket” capital needs: new facilities, renovations, land, technology, etc.

BORROWER ER

(School District)

INVES VESTOR OR

BOND

$

IOU + interest

Local Tax Effort

The Annual District Budget is passed by the School Board of Trustees. 84.8 % of the District’s M&O budge dget suppor pports ts person sonne nel l salari laries es and d relat lated d costs. sts.

M&O I&S

I&S funds may only be used to repay debt. They cann nnot t be used ed for r salar laries, ies, utili ilities ties or other her day-to to-day y expen penses. ses.

HB3

• House Bill 3, a school finance bill

passed by the 86th Texas Legislature earlier this year provided additional state funding for our schools and aims to provide property tax relief to Texans.

• Reduced M&O property tax rates

by approximately $0.07cents per $100 valuation this year and potentially more over the next two years. M&O I&S

Employee pay increases Full-day PreK funding Increased base funding per student No money for new facilities to address growth or renovations to existing facilities

$ X

Local Tax Effort

16

Capped at $0.97 per $100 of property value.

If a district wants to raise the rate beyond the cap, it requires voter approval through the holding of a Tax Ratification Election. M&O I&S

Capped at $.50 per $100 of property value.

Every cent requires voter approval in a Bond Election.

Current Victoria ISD Tax Rate

M&O TAX RATE $0.97 I&S TAX RATE $0.2235 TOTAL TAX RATE $1.1935

per $100 of property value

+ =

Tax Rate History

1.03 1.03 1.03 1.03 1.03 1.04 1.04 1.04 1.04 1.15 0.97 0.2927 0.2926 0.2926 0.2790 0.2596 0.2344 0.2263 0.2263 0.2263 0.2263 0.2235

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2020 Maintenance Debt Service

2019-20 General Fund Budget

85% 85% 15%

Payroll Costs Supplies, Materials & Equipment

Bond History

Bond History

$10,375,000 $31,000,000 $99,841,004 $58,999,992

1989 989 1998 998 200 007 200 008

Bond Planning Process Overview

Bond Planning Process

Assess Needs at Existing Facilities

Identify deficiencies and inequities in existing campuses

Set Long Range Educational Vision for Academic Programming

Determine evolution of program demands, instructional objectives, expectations and standards

Study Demographics & Enrollment Projections

Determine areas of underutilization,

• vercapacity and needs

for future growth

Review Financial Data

Understand the financial implications to make fiscally-sound recommendations

ASSESS REVIEW STUDY VISION

Ongoing

• ing Respo

ponsib nsibilit ities es of VISD

Bond Planning Process

Prioritize Potential Projects

Develop consensus on the how to address the District’s needs

Board Calls a Bond Election

Board is required to take action on calling bond within 78 days of desired Election Day

Board Considers Calling Bond Election

Board studies recommendations to determine action

Make Recommendations to the Board

Present findings and recommended course of action to Trustees

PRIORITIZE

RECOMMEND

CONSIDER CALL

Responsibility ponsibility of the Bond d Planning ning Subcommi committ ttee ee

Bond Planning Process

District Educates Voters on the Proposal

It’s the school district’s role to communicate facts about the bond

District Sells Bonds to Investors

District issues bond sales in increments over time to match the schedule of project design and construction

Voters Approve Bond Election

A majority of voters voting in favor of the proposition(s) gives the Board authority to sell bonds

Voters Consider Proposition(s)

School bond propositions must be held with the General elections in May

• r November

EDUCATE VOTE APPROVE SELL

Shared d Responsibil ponsibility ty

Bond Planning Process

Board Levies I&S Tax Rate

The Interest & Sinking tax rate (set annually) is levied to make annual debt payments

Project Construction

Construction takes

• approx. 12-14 mos. for

an elementary and 24-28 mos. for a high school

Projects Bid

Projects are bid in the competitive market to select a contractor and get the best value for the District

Project Design

Project design is a multifaceted process that begins conceptual and concludes with construction documents

CONSTRUCT BID DESIGN LEVY

Facility Assessment Overview

Facility Assessment Overview

We h e have e a t a tea eam of pr profes ession sional als s who have e bee een: n:

• Gathering documents of the VISD facilities
• Walking and observing 17 sites, 85 separate structures and 1,431,771

square feet of district facilities

• Reviewing and documenting with VISD staff any known needs of the district

and facilities

• Downloading institutional knowledge important to the task at hand
• Meeting with leadership to understand what the future vision of VISD is and

how the facilities need to serve that future

Assessment Components

The assessments are focused on deficiency items discovered by the Assessment Team as they survey each facility. The items addressed can be broken up into the following categories:

• Campus Data and Utilization

(previous renovations, compliance, programming, etc.)

• Site Civil (site paving, drainage,

accessibility)

• Architectural Exterior and Interior
• Structural
• Mechanical
• Electrical
• Plumbing
• Roofing
• Fire Protection
• Food Service
• Technology
• Security

Assessment Components

The assessments are focused on deficiency items discovered by the Assessment Team as they survey each facility. The items addressed can be broken up into the following categories:

• Campus Data—Current square footage,

code compliance, age, previous additions and renovations

• Utilization— to help the District analyze

program and operational options for each campus

• TEA Compliance and Educational Adequacy
• Civil—Site as required
• Architectural Exteriors
• Architectural Interiors
• Accessibility (ADA) Review
• Structural as required
• Mechanical
• Electrical
• Plumbing
• Fire Protection
• Roofing
• Food Service
• Technology
• Security
• Maintenance Identified Items

Facilities Included in the Assessment

• 1. Aloe ES
• 2. Chandler ES
• 3. Crain ES
• 4. DeLeon ES
• 5. Dudley ES
• 6. FW Gross ES
• 7. Hopkins ES
• 8. Mission Valley ES
• 9. O’Connor ES
• 10. Rowland ES
• 11. Shields ES
• 12. Smith ES
• 13. Vickers ES
• 14. Howell MS
• 15. Patti Welder MS
• 16. Stroman MS
• 17. Liberty Campus

Facility Assessment Schedule

Novemb ember er 5 – 20, 2019 Collect, review and upload drawings Nov v 12 – De Dec 11, 2019 Field observation at all campuses Nov v 15 – De Dec 20, 2019 Floor plan development Janu nuar ary y 6 – 10, 2020 TEA review and analysis Review with Principals/Department Heads Janu nuar ary y 13 – 17, 2020 Review deficiencies for assessment report Janu nuar ary y 28, 2020 Submit assessment draft Febr bruar uary y 14, 2020 Submit final assessment

Defining Consensus

Consensus Defined

Cons nsen ensus us Def efin ined ed: Consensus is defined by Merriam-Webster as:

• a general agreement
• the judgment arrived at by most of those concerned
• group solidarity in sentiment and belief;
• concerned with the process of deliberating and finalizing a decision

Goal: Goal is to agree on a definition and then, once recommendation goes forward, for everyone to be able to support it.

Group Discussion: What is Our Definition of Consensus?

• Unanimous agreement
• Unanimous consent (“I can support that.”)
• Unanimous agreement minus one or two votes
• Unanimous consent minus one or two votes
• Super majority thresholds (90%, 80%, 75%, two-thirds, and 60%

are common)

• Simple majority

Meeting Wrap-Up

Next Meeting

Wed edne nesd sday, , Ja Janu nuar ary y 22 22, 20 , 2020 20 VIS ISD D Con

• nferen

erence ce Cent enter er, , Roo

• om

m D

Demographic Projections Campus Capacity & Utilization