[PPT] - School District of Kettle Moraine Referendum Options JULY 17, 2018 PowerPoint Presentation

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School District of Kettle Moraine

Referendum Options

JULY 17, 2018

Baird Public Finance

Lisa M. Voisin Managing Director 414-765-3801 (office) 414-828-8794(cell) lvoisin@rwbaird.com

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plus (+) State Equalization Aid: $5.8 Million equals (=) Total Revenue Limit: $37.5 Million

Total Tax Levy $36,127,978 Revenue Limit Levy $31,676,092 Community Service Levy $215,255 Referendum Debt Levy $4,236,631

Total 2017-18 Tax Levy

Source: Department of Public Instruction

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Total 2017-18 Mill Rate

Total Mill Rate $10.08 Revenue Limit Mill Rate $8.84 Community Service Mill Rate $0.06 Referendum Debt Mill Rate $1.18

Source: Department of Public Instruction

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Current Budget Forecast

BUDGET FY - 2018 FY - 2019 % ∆ FY - 2020 % ∆ FY - 2021 % ∆ FY - 2022 % ∆ FY - 2023 % ∆ REVENUE Local Sources $32,210,592 $32,240,327 0.09% $31,909,080

1.03%

$31,825,853

0.26%

$32,066,396 0.76% $31,971,352

0.30%

State Sources $7,923,301 $7,762,867

2.02%

$7,757,695

0.07%

$6,971,218

10.14%

$6,296,150

9.68%

$5,728,004

9.02%

Federal Sources $213,291 $213,291 0.00% $213,291 0.00% $213,291 0.00% $213,291 0.00% $213,291 0.00% Other $3,894,265 $3,915,821 0.55% $4,069,491 3.92% $4,103,409 0.83% $4,237,213 3.26% $4,452,837 5.09% TOTAL REVENUE $44,241,449 $44,132,306

0.25%

$43,949,557

0.41%

$43,113,771

1.90%

$42,813,050

0.70%

$42,365,484

1.05%

EXPENDITURES Salary and Benefits $29,519,653 $28,171,604

4.57%

$28,642,048 1.67% $29,260,229 2.16% $29,775,162 1.76% $30,558,947 2.63% Other Objects $16,816,049 $15,960,701

5.09%

$16,258,164 1.86% $16,497,307 1.47% $16,770,245 1.65% $17,052,443 1.68% TOTAL EXPENDITURES $46,335,702 $44,132,306

4.76%

$44,900,213 1.74% $45,757,536 1.91% $46,545,407 1.72% $47,611,390 2.29% (CUMULATIVE BUDGET SHORTFALL) ($2,094,253) $0 ($950,656) ($2,643,765) ($3,732,357) ($5,245,906) ANNUAL BUDGET SHORTFALL (Non-Cumulative) ($2,094,253) $0 ($950,656) ($1,693,109) ($1,088,592) ($1,513,549)

Fund 10 - General Fund - Projection Summary

REVENUE & EXPENDITURE PROJECTIONS

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Comparison of Referendum Options

ONE QUESTI ON $ 5 .5 Million for 2 0 Years TW O QUESTI ONS Debt and Operational

Single question – easier to communicate Keeps Facility and Operations Questions Separate Non-recurring Referendum : Lock in operational amount for 20 years. Can revisit budget after certain number of years and go back to referendum if needed. Non-recurring Referendum : Lock in operational amount for 4(?) Years. Must go back to referendum upon expiration of operating increase. Recurring Referendum : can revisit budget after certain number of years and go back to referendum if needed. Recurring Referendum : can revisit budget after certain number of years and go back to referendum if needed. Initial tax impact estimated at $47 on $100,000 Property Initial tax impact estimated to be minimal or $0 Requires 30-day petition period in addition to referendum Strategy to borrow less (lower interest cost of

approx. $8,000,000)

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Comparison of Debt

ONE QUESTI ON TW O QUESTI ONS

Use operating referendum funds to pay for projects for two years, then issue debt for remaining projects in year two (approx. $ 1 2 ,2 0 0 ,0 0 0 debt) Issue debt for total project costs -$ 1 9 ,6 0 0 ,0 0 0 Structure debt around operating needs, amortized

ver 18 years (average life around 10 years)

Structure debt around existing referendum debt service, amortized over 21 years (average life around 16 years) Total interest cost estimate approx. $5,300,000 Total interest cost estimate approx. $13,300,000

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One Question - $5.5 Million 20 Years

Note: im pact on state aid is not incorporated due to the district being in hold-harm less.

$0 $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 2019‐20 2020‐21 2021‐22 2022‐23 2023‐24 2024‐25 2025‐26 2026‐27 2027‐28 2028‐29 2029‐30 2030‐31 2031‐32 2032‐33 2033‐34 2034‐35 2035‐36 2036‐372037‐38 2038‐39 Available funds for Operating Referendum Projects ($7,400,000) Referendum Debt ($12,200,000)

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One Question - Tax Impact

* After 2018 defeasance and hypothetical 2019 defeasance. * * Assum es $5,500,000 in 2019-20 through 2038-39 (20 years). Mill rate based on 2017 Equalized Valuation (TID-OUT) of $3,584,468,052 with annual growth of 3.00% for three years and 2.50% thereafter. Note: im pact on state aid is not incorporated due to the district being in hold-harm less.

$10.87 $10.28 $10.40 $10.31

$10.08

$0.00 $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 2013‐14 2014‐15 2015‐16 2016‐17 2017‐18 2018‐19 2019‐20 2020‐21 2021‐22 2022‐23 Mill Rate Existing Levy Inside Revenue Limit (F10 & F38) Fund 41 Fund 80 Existing Referendum Debt Service* Hypothetical Operating Referendum**

REFERENDUM REFERENDUM REFERENDUM REFERENDUM REFERENDUM

‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ Estimated ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ Actual ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐

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Two Questions - Tax Impact

* After 2018 defeasance and hypothetical 2019 defeasance. * * Assum es $2,500,000 in 2019-20, $1,100,000 ($3,600,000) in 2020-21, $600,000 ($4,200,000) in 2021-22 and $1,000,000 ($5,200,000) in 2022-23. Mill rate based on 2017 Equalized Valuation (TID-OUT) of $3,584,468,052 with annual growth of 3.00% for three years and 2.50% thereafter. Note: im pact on state aid is not incorporated due to the district being in hold-harm less.