Ida Bond Proposal Q and A

The Ida Board of Education, in collaboration with the Ida Building Task Team and the Ida Building Committee, recommended and approved an updated bond proposal for the August 2, 2022 ballot.  The proposal is $43 million for an estimated millage of 4.94 for 30 years.

The need does not go away.  It is not uncommon for a district to try multiple times for a bond.  Of the 13 school bonds that passed in November of 2022 in the state of Michigan, all but two attempts were 2nd, 3rd, 4th and in one case a 5th attempt. The two that were first attempts were bonds with no increase to taxpayers over what they were currenting paying for a debt millage.

As shared in the Superintendent Brief in January, we are on borrowed time.  See details in the  Superintendent Brief January 31 2022 . 

Truth be told, economy wise, there is never a good time to propose a bond, one that has been needed for the past 10 – 15 years for just safety and security, and our heating systems.  

The facility study was conducted by experts and the decision made by three groups, the Ida Building Task Team, the Ida Building Committee, and the Ida Board of Education.  This approach is not dependent on who the is superintendent.  The in-depth facility study, which took 10 months to complete, is a plan for the next 30 years and will become a part of the Ida Public Schools strategic plan.

Ida Public Schools utilizes 2 mills each year from the general budget to take care of manageable projects which is not enough to take care of the bigger ticket items, especially when all buildings were built within 14 years of each other over 55 years ago.  

School bonds are a way for school districts to get the funds needed for capital projects. The school district gets up front cash from investors which is used for capital projects.  The school in return agrees to pay the investor back over a fixed time period. School bonds work a lot like home loans or corporate bonds.  A bond allows the district to complete improvements in the space of a few years but pay those improvements over a longer amount of time. 

School bonds are the legally permissible way for schools to fund major capital projects dating back to as early at the ‘80’s.  Between Monroe, Lenawee, and Wayne county, there are 3 school districts without debt.  Ida being one of them.  Please see our website for the debt millage each district’s taxpayers have approved to maintain facilities in Monroe, Lenawee, and Wayne county.  See the Q and A “Should school districts let a school bond expire” for a second part to this question.

Improving existing facilities, building security, and four additions.  A bond allows the district to complete improvements in the space of a few years but pay those improvements over a longer amount of time. 

It can be viewed as a line of credit to fulfill facilities needs and community wants.  For example, additions, athletic complexes, and the extras a district and community might want!  Ida truly has needed bond support since the 90’s and have fallen behind in educational opportunities and safety, and  bigger ticket item facility needs that cannot be covered from the general budget. 

Since Ida does not have an existing debt millage, and has not for many years, it is was advised to keep the debt millage no more than 3.5 mills in order to minimize the impact to the taxpayers. 

We conducted a scientific survey hiring EPIC where it was found that our taxpayers, with a slight majority, would consider up to 40 million.  Our bond proposal, in November, was 38.8 million at 4.7 mills for 30 years.   The current bond proposal is 43 million at 4.94 mills for 30 years.   See tax calculator on our website for what that would cost you a year.

The current estimates are $82 million for a new high school and the same improvements, additions, and updates to the elementary and middle school in this bond proposal, not counting conversations costs to the other buildings if consolidating were considered.  $66 million for a new elementary and the same improvements, additions and updates to the middle school and high school in this bond proposal.   Based on the in-depth facility study, the bones of all the buildings are good.  

The building task team determined a need of 21 million dollars for essential improvements. The building task team then determined additional facility needs for safety and education and the building committee prioritized and chose those next of importance after the essential improvements.

Please refer to the Ida Public Schools webpage bond section and click on Debt Information – the Monroe, Lenawee, and Wayne Counties option.  One example:  Our nearest district, Dundee, has passed two bonds since 2000 and has 5.73 mills of debt.  They are seeking a bond renewal in August.

A voter approved millage, for a 3-mill maximum for a maximum term of 10 years.  The funds received from the annual sinking fund revenue typically finance smaller projects on a pay as you go bases.

An in-depth facility study with $90 million for facility upkeep over the next 30 years was analyzed by the facilities task team.  $21 million was identified as the current essential amount of need for all three buildings. An additional $5 to $7 million of facility updates from this study were designated to be completed using the general fund over the next 10 years.  The remainder of the $90 million was prioritized by urgency.  The data from the 2021 in-depth facility study will become a part of the 2022 strategic plan for our district.   The need after 10 to 15 years could be addressed by a bond renewal if there is essential need for upkeep and/or educational needs or recreational and athletic wants beyond the general.

Elementary 1950

Middle School 1954

High School 1964

Most school buildings in America were built in the 50’s and have had major improvements and additions since then. 

The proposed classroom addition and gym/all-purpose room addition to the elementary, will be positioned on the site to add future additions as needed to replace sections of the building that could need to be replaced over the next 60 years.  For perspective as to when that could be, Dundee’s elementary was built in the 1920’s and the bond they are proposing in August 2022 has an addition to that building.   Point, Dundee is adding onto, not tearing down, a building from the 20’s.  This is the case for the districts around the state.  The average year of construction for most school buildings in the country and state is in the 1950’s. 

It is not cost effective for our taxpayers.  The in-depth facility study concluded in 2021 shows that the bones of the buildings are good.  The cost for essential improvements to each building averages $9 million which is more cost effective than building new.  When working with taxpayers’ dollars, you weigh if it is more cost effective to build or to do improvements similar to how you would decide for your own home.  See How many dollars for a new building and the same improvements, additions, and updates for more information.

• More in-depth information to why not new buildings:  Three years ago, in 2018, it was estimated a new elementary could cost $32 million, and a new high school could cost $50 million not including the costs to update the other buildings mechanically or conversation costs.  An in-depth facility study was not done in 2018 when conversations at community meetings revolved around should Ida build a new elementary or high school.  Now a 2022, a 2021 in-depth facility study is driving the proposal that the bones of the buildings are good, and it is more cost effective to improve our current facilities than to build new.     
• What is the projected cost of a new elementary and new high school today? With COVID and expected escalation, it has been suggested that prices today could be 30to 40% higher than 3 years ago. This would be approximately $41 to $45 million for the elementary and $65 to $70 million for a new high school.

We had a general facility summary in 2018 from Kohler Architects (see website for this summary).  From this, it was said that we needed to build, and two options were given, a new elementary or a new high school.  When reviewing the 2018 data in 2019, there was not a comprehensive facility study and data to determine if it is was more cost effective to update or to build new and if the bones of the buildings were good.  The summary said the buildings had served their purpose, but the data could not back it up.  We needed a comprehensive study so we could develop long range goals and a master plan.  In February 2020, the Ida School Board authorized the superintendent organize professionals and our onsite team to conduct an in-depth facility study.  The study was fully completed in January of 2021.

We contracted to have an in-depth facility study that went from a general facility summary used in 2018 to an in-depth facility study that took 10 months and was completed in January of 2021.  The extensive data from the 2021 in-depth facility study will become a part of the strategic plan for our district.  

Based on the in-depth facility study, it projected just under $9 million to complete essential improvements for the elementary building.  To build a new elementary, costs were estimated pre-COVID at $32 million, today escalation projects $41 to $45 million.  In addition, to add safety and curriculum for the elementary along with the essentials (see bond proposal), the cost is projected at $19,619,727, as opposed to $41 to $45 million projected for a new elementary today.  

If money was not an object, you could propose to build new.  When we are talking taxpayers’ dollars, money is an object that cannot be ignored. 

On behalf of the Ida Board of Education and the Ida community, I submitted a proposal to the Michigan Senate Budget Committee for state funding assistance for an entrance to the school campus from Ida East Road. This would allow safe, essential, and adequate traffic flow to the campus while not obstructing emergency routes. The Mannik & Smith Group assisted with the proposal. It is estimated at $2.5 million.  It includes three lanes, lighting, drainage, and curbs and is also positioned for further use of our property to the east. This proposal has now been submitted to the Senate Appropriations Chair’s office as a priority for Senator Zorn. This office will decide based on funding available

If our construction can be concluded in time, we could use the remaining ESSER money for HVAC that is not included in the bond proposal.

The bones of the buildings are good.  The elementary additions are carefully designed to accommodate growth and expansion should that be needed.  Dundee is proposing to add onto their elementary building that is 30 years older than ours.  There are no new buildings in Monroe county being considered or, again, in most of the counties around the state.   See What is the vision for the elementary additions for more information.

No, when reviewing the highlights of the bond proposal for each building, you will note that those items would be needed regardless of the number of students.  Evan the elementary classroom addition and gymnasium is to make more room for pre-K options and flex space. Our school family members who are school of choice round out the class numbers which are maintained at a low number in most classrooms.  In order to do that this year, we closed school of choice early. 

Since Ida’s Schools has no existing bonds or debt millage, it was advised to keep the millage within 3.5 mills to minimize the impact to taxpayers.  We conducted a scientific survey, hiring EPIC, where it was found a slight majority of our taxpayers would consider up to $40 million. 

There is not an easy answer to that.  Each of our financial situations are different, especially in these times of inflation.  What we can say is that our facilities needs are not going away, nor will the prices go down.  If we must wait longer for another bond attempt, the costs will be even higher, and we will get less for our money.

We are taking on $5 million to $7 million from our general budget over the next 10 years for capital improvements identified in the in-depth facility study.  We are seeking other funding for the Agri-Science building and a secondary entrance to our campus from Ida East Road to help keep the burden on taxpayers down.   

When asked this, Kohler Architects and Kingscott said that if Ida had continued their research in 2018 from the general facility summary they started with, that team would most likely would have come to the same conclusion after an in-depth facility study.  The cost needed for the new building and the other buildings  would exceed what taxpayers could afford.  Especially when Ida has no current debt.  There are 16 original members of the building committee in 2018 on the current building committee who transitioned in their thinking with the complete data set. 

Not yet. For a bond proposal, you apply to the Dept of Treasury and cost estimates are required from a creditable firm.  Estimates are the current numbers being used.  To move forward, we would need the approval of the voters before expending the funds to complete the designs and go forward with the bidding process.

If the bond proposal passes, the district then starts a rigorous and strict bid process dictated by legal standards.  Local contractors would be encouraged to bid. 

As our construction manager, Clark would organize the bidding process and solicit local contractors to bid.  Clark would oversee and make sure the bid process is protected and enforced, that contractors stay on schedule, and our bond proposal is upheld.  No one on the Clark team does the work or submits bids, again, they are Ida Public Schools construction manager. 

We invited all the members back from the 2018 building committee.  16 agreed to serve again.   We then invited additional community members and business owners.  Senator Dale Zorn offered to help and requested to be an honorary member.   He is in full support of the bond proposal.

Bob Cherry, John Elkins, Keith Kohler, Steve Stotz, Matt Darr, Mike Mero, and Sandy Kreps.  Kingscott Architects and Clark projected industry standard estimate numbers.

Many families and individuals will be super busy this summer and/or at the fair or on vacation August 2, 2022, election day for the bond and primaries. If you prefer, you can register for an absentee ballot at https://mvic.sos.state.mi.us/Home/VoteAtHome

BUILDING AND SITE BOND PROPOSAL

Shall Ida Public School District, Monroe County, Michigan, borrow the sum of not to exceed Forty-Three Million Three Hundred and Five Thousand Dollars ($43,305,000.00) and issue its unlimited tax general obligation bonds therefore, for the purpose of defraying all or part of the cost of:

Erecting, completing, remodeling, and equipping or reequipping school buildings, including playgrounds and parts of or additions to those facilities; furnishing and refurnishing new and remodeled school buildings; preparing, developing, or improving sites, or parts of or additions to sites, for school buildings, including playgrounds; acquiring, installing, or equipping or reequipping school buildings for technology?

YES           NO

The following is for informational purposes only:

The estimated millage that will be levied for the proposed bonds in the year 2023, under current law, is 4.94 mills ($4.94 per $1,000 of taxable valuation). Thirty (30) years is the maximum number of years that the proposed bonds may be outstanding, exclusive of any refunding. The estimated simple average annual millage anticipated to be required to retire this bond debt is 4.71 mills ($4.71 per $1,000 of taxable valuation).

The school district currently has $0 of qualified bonds outstanding and $0 of qualified loans outstanding under the State School Bond Qualification and Loan Program. The school district does not expect to borrow from the program to pay debt service on these bonds. The estimated computed millage rate may change based on changes in certain circumstances.

(Pursuant to State law, expenditures of bond proceeds must be audited, and the proceeds cannot be used for repair or maintenance costs, teacher, administrator or employee salaries, or other operating expenses.)

The bond proposal is for 4.94 mills ($4.94 per $1,000 of taxable valuation) for 30 years. The estimated simple average annual millage anticipated to be required to retire this bond debt is 4.71 mills ($4.71 per $1,000 of taxable valuation as projected by PFM).  Our district website has a link to a calculator as well as tax break information.