Ambitious Proposal Will Bump Taxes

cost considerations

PROJECTED ANNUAL TAX INCREASE
$900 – $1,384 – The amount of per-year increase on a $1 million home (approximately $75-$115 per month), depending on when debt is issued and how it is structured.

EXPECTED TAX RATE
$1.2280 – $1.2905 – Expected rate for 2017-18 depending on timing and structure of debt issuance.The bond structures being considered are for a 20-30 year bond term.

Source: HPISD

Even in the Park Cities, where the average home sells for more than $1 million, the latest bond proposal from Highland Park ISD is financially ambitious.

The district is asking taxpayers to approve more than $361 million on Nov. 3 for the razing and rebuilding of three elementary schools, the addition of a new elementary campus, and extensive renovations to its three remaining schools.

It’s the product of a big-picture mindset to combat unprecedented enrollment growth that’s expected to continue. But do the dollars make sense?

HOW IT ADDS UP

Elementary Schools
$139.8 Million

Highland Park High School
$113 Million

Land Acquisition
$45 Million

HPMS/HIS
$38.3 Million

Misc. Costs
$25.3 Million

TOTAL COST
$361.4 MIL

Source: HPISD

“I think the $360 million price tag scares some people a little bit, but I think a lot of people feel it’s worth it,” said Blythe Koch, a member of the Facilities Advisory Committee, a volunteer group that spent several months helping conceive the idea before presenting it to HPISD trustees. “There were a lot of issues that we felt we couldn’t address with renovation. The cost-benefit analysis was what drove us to that decision.”

During the past 25 years, HPISD has seen enrollment rise by an average of 2.2 percent per year. That brings the total to 7,092 students, or an increase of 3,000 between 1989 and 2014. According to the district, demographers forecast another 1,000 students to enroll by 2023, as more young families buy homes.

If it’s approved, the bond referendum would likely add more than $1,000 per year to the tax bill for a $1 million home, depending on when the debt is issued and how it’s structured. That would land somewhere around $1.25 per $100 of assessed property value. The term would likely be 20 to 30 years.

Homeowners 65 and older aren’t subject to the increase because of a homestead exemption. Other property owners are subject to a 20 percent exemption from the district.

FAC members said the timing is key. The plan calls for the fifth elementary school to be built on 4.6 acres the district plans to buy for $20 million from Northway Christian Church. The new school would be constructed first, then used as a relief campus as Bradfield, Hyer, and University Park elementary schools are torn down and rebuilt, one by one, over a three-year period. Then the attendance zones would be redrawn and the new school would open.

Furthermore, the committee emphasized currently favorable interest rates for issuing debt, and other economic factors that didn’t make a proposal of this magnitude feasible in 2008, when HPISD held a $75.4 million bond election.

Yet even in an affluent community with high expectations for its public education system, will the latest bond plan stretch the limits of the tax burden that HPISD voters are willing to bear?

“This makes no sense,” said Steve Dawson, treasurer of the Save HPISD Schools Committee. “There are other ways to approach this problem that are more cost-efficient.”

Dawson criticized trustees for poor planning, lack of transparency, and fiscal irresponsibility with the proposal, and said the package should focus more on core needs for students.

“We’re struggling to maintain any sort of trust in this board,” Dawson said. “We’re very concerned about the fact that this is an inflated bond.”

However, bond proponents argue the costs are necessary to ensure that facilities will remain in line with future student needs.

“That’s a number that is worth educating our kids the right way and with the right facilities,” said Doug Thompson, co-chairman of the FAC.

15 thoughts on “Ambitious Proposal Will Bump Taxes

  • October 23, 2015 at 11:35 am
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    Actual HPISD 2015 Enrollment is DOWN from 2014

    The core reason for this huge bond is based on a already-off-the-rails demographic study.

    What is REALLY driving the desire for this bond? How much of the bond is going to pay for federal mandates due to HPISD taking Federal Funds – mandates that go away by the district simply not taking any more Federal Funds?

    http://www.parkcitiestaxpayers.org/HPISDTakesFederalFundsinSecret.html

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    • October 23, 2015 at 12:15 pm
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      Separate from the bond, HPISD does receive a little less than $1 million per year in the form of IDEA (Individuals with Disabilities Education Act) grants which are for the education of special needs students. The decision to accept this funding was not made in secret, but in the district’s finance committee meetings, which are always posted and open to the public. In 2005, the Texas legislature required all school districts to lower their tax rate by one-third, but promised that the state would make up the lost tax revenue. When the recession hit in 2008, the Texas government had no money to make up the shortfall to districts, so the Texas government used the money it received from the federal stimulus package to reimburse school districts. In 2009-2010, these federal stimulus grants were passed on to all districts in Texas whose funding had been cut. When those grants were discontinued in 2011, the Texas government still had no money to make up for the tax revenue shortfall it had created in 2005, and HPISD therefore made the decision to receive the IDEA grants as a means of making up for its lost tax revenue. As stated before, IDEA grants are solely for the education of special needs students and are not in any way tied to curriculum or other requirements by the federal government. It is worth noting that Texas currently ranks 44th in the country in education funding per student, so all districts in Texas are suffering from the state’s lack of funding. It is also worth noting that these grants are not the first federal money received by HPISD. Highland Park High School was actually built as a part of FDR’s Work Projects Administration (WPA) program in the 1930’s.

      https://docs.google.com/document/d/1EOXsOITqQqXfZRX9mWsRlG0W8tpODntVjyVYJFR5b_U/pub#h.2s8eyo1

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      • October 23, 2015 at 1:32 pm
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        HPISD HIDES the Fact that it takes Federal Funds – nowhere in its budget documents are federal funds mentioned.

        HPISD is currently trying to reach a Title IX settlement agreement with the Department of Education because of its taking of federal funds. The Board sold out the school district and the community for far less than 1% of its overall budget.

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      • October 23, 2015 at 9:06 pm
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        Here’s a needle in a haystack for you to hunt, sir. Show us where, in this 2014 HPISD financial statement, you can see HPISD receiving federal funds. And then tell us how long it took you to find it (assuming you ever do).
        http://www.hpisd.org/Portals/0/docs/business/CAFR_2014_HPISD.pdf

        And with all due respect, your understanding of the federal Department of Education’s unfettered power over school districts which accept federal funds is flat-out wrong. Whether the money is taken for ADA needs or an organic garden matters not. Once a district accepts federal money for ANY reason, it is under the federal government’s thumb.
        http://www2.ed.gov/about/offices/list/ocr/docs/title-ix-rights-201104.pdf

        The DOE’s power over schools is practically limitless. For instance, if a school district’s disciplinary policies disparately impact minorities, the DOE will order those policies to be changed. In addressing sexual harassment and sexual assault complaints (and assault includes any sexual contact after drinking) the school district must handle them in precise accordance with the DOE’s edicts (which do NOT allow due process for the accused). It won’t be long before curriculum changes will be required if the existing curricula disparately impacts the grades of minorities.

        As for higher property taxes, please ask the YES PAC and HPISD Trustees to explain how they arrived at their forecasted increase — an UNCAPPED tax increase district residents will be forced to shoulder in ever higher amounts for decades to come. An honest person would admit that because the financing is still up in the air, it is virtually impossible to predict with any accuracy the increased taxes we will all be paying. For the district’s Trustees to claim otherwise is deceptive and borders on outright malfeasance. Moreover, a substantially higher tax burden will substantially lower property values; a death spiral in property values is not beyond the pale. (A death spiral in donations to Mad for Plaid is a virtual certainty.)

        The Board’s projected tax increase is wholly suspect because of all the unknowns. Is the Board’s estimated property tax increase it touts based only on the first wave of bonds alone? Or the full $361M debt? Or, instead, the full $361M plus our still unpaid 2008 bond debt and our other outstanding debt? Why does the Board limit its forecast to 2017/2018? Will our bonds carry a twenty or thirty-year maturity? What interest rate will we be paying the bond holders? Will that interest rate be fixed or floating? Why did the Board award the Royal Bank of Canada the bond underwriting job in a closed-bid process?

        Finally, please ask the Trustees if they expect to be back to the trough for more money as quickly as they came after the 2008 “bandaid” bond. We all recall that the ’08 bond was NEVER marketed to voters as a six-year bandaid. Why? Because obviously we would have defeated it. And yet the Trustees now expect us to trust and believe in them in this $361M bond package? Shirley they jest.

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        • October 24, 2015 at 12:12 pm
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          5 seconds using a PDF search to find the Federal program in your link. Page 46 of 147.
          It’s easier, though, to hide behind anonymity in making false statements and promoting disinformation. Please keep commenting and mention transgender bathrooms and day care in the elementary schools for children of students. Mention common core, section 8 housing or that the new school will be named Adolf Hitler Elementary.

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          • October 26, 2015 at 9:31 pm
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            Felipe, I am not hiding. Answer me this. Why have no open forums been held in our community? Why are the demographic projections so off? An M & O report show enrollement for 2015-2016 to be projected at 7,196. Over 130 students off. Feel free to spout contentious items, but your motives are obvious. Make people who disagree look like loons. Common core and section 8 are real and even if they are far fetched, this bond proposal is suspect. At every turn the district changes their numbers and facts. I have been asked to give opposing views by various groups and the they suddenly cancelled or didn’t return my calls. If the construction is up for bid, why did Pritchard and Associates sow HPISD as a “coming soon” project? Once the school district was alerted, it suddenly was removed. I don’t know what the district and you are so afraid of in actually having an intelligent discussion about the bond, but no one is willing to step up and meet me in public.

          • November 3, 2015 at 2:01 am
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            Dang! You got me, Felipe — which I’m happy to concede, despite your prior ad hominem attacks. But you knew what to look for, and where to look.

            Most parents have NO idea that HPISD has been accepting federal money since 2010 — for the first time ever, in this district. Instead, most parents — many of whom work their tales off at the cafeteria or wildly donate to Mad for Plaid, in an effort to save the district money and stave off federal control of our schools — put their trust in the Board of Trustees. Poring over a CAFR at night after working a long day is just not on their list.

            It took me quite a while … all the way to page 114 of this 143-page voluminous report … to discover our district started taking federal money starting in 2010, to the tune of $7M+ over these four years. And it was NOT easy to find.

            You are right in one respect: the district must spend this money exclusively on our students with disabilities (“IDEA”). Maybe you can show me where this $7M+ money was spent. I’m still scouring the CAFR and can’t find those expenditures.

            But you are wrong in another respect, and make no mistake about it: once our district takes even a dollar of federal money — regardless the purpose — we have ceded almost all control to the federal government. The DOE may be leaving us alone for the time being. But no one knows what it takes to awaken that sleeping federal giant.

      • October 26, 2015 at 9:14 pm
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        Felipe, I am certain you can distinguish between a federal work program and actual federal money taken for education purposes. In 1930, as a nation, we didn’t even have a department of education. Stop with the talking points and stick to the facts! It wasn’t until Jimmy Carter in 1979 we had a DOE.

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      • October 26, 2015 at 11:41 pm
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        Felipe, when as a community we raise one million plus each year in capital campaigns to off set Ronin Hood, don’t you think if the public were given the choice of taking federal funds, FOR THE FIRST TIME IN HISTORY, we would have stepped up and raised an additional 999,000 dollars? The fact that you and the FAC members dug up the fact that HPHS was built with FDR’s WPA shows your ignorance. Current federal funds have to do with the DOE, which wasn’t even estsblished. WPA was a work program to boost the economy, the DOE was established by Jimmy Carter to establish policy in education, two completely differnt things.

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  • October 24, 2015 at 5:30 pm
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    Can anyone explain why on earth we are paying Northway $20M for roughly 4 acres of land in the City of Dallas? ALL of HPISD-owned land — combined — is currently valued at $23M. And bear in mind, all that currently-owned HPISD land is in the Park Cities, not the City of Dallas.

    WTH is going on?

    http://www.hpisd.org/Portals/0/docs/business/CAFR_2014_HPISD.pdf — page 42

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  • October 27, 2015 at 3:59 am
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    Permit me to second the excellent points made by Ms. Schuh that, once again, remain uncontroverted. Surely if the YES! PAC people had information to refute her facts, they would certainly have posted it here. Rarely a day goes by — weekend or otherwise — when parents’ inboxes are not full of ever more YES emails. These emails paint anyone who questions the wisdom of this bond as “spreading rumors and making false claims” and then go on to repeat the same tired “talking points” spouted so often we can recite them like lemmings in our sleep.

    No, there’s no rest for the wary in this bond election. There’s just a cacophony of calls by the inclusive, tolerant wing of our “community” for the names and the heads of all dissenters. Some grown-ups, it seems, lust for a real-life whack-a-mole and eschew civil discourse about a bond issue that includes competing views.

    And I will re-urge the earlier question in this thread — still unanswered — about the gobsmacking sum of $20M the Board has offered to pay for a mere 4.6 acres located not in the Park Cities, but within HPISD’s boundaries.

    To put this $20,000,000.00 amount into perspective, consider:

    First (and this is a rough but conservative estimate), HPISD’s four elementary schools sit on land averaging 4 acres a piece; its middle school occupies roughly 6 acres; and the high school is on at least 6 acres, for a total of 28 acres — at a minimum — all within UP/HP (not on land far less valuable, which, while within HPISD’s boundaries, is in the city of Dallas).

    Second, using back-of-the-napkin scratch math, the district currently assigns the value of its raw land of 28+ acres a fair market value of $23M. Or, put another way, each district-owned acre has a current value of at least $1.2M each.

    Given that our total current landholdings are valued at roughly $23M, why has our School Board offered to pay another $20M for less than 5 acres that are not even within UP or HP? This unorthodox, screwball offer defies all logic and only fuels the growing skepticism and mistrust in this Board.

    Reply
    • October 28, 2015 at 7:36 pm
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      @LLogan,
      The value that DCAD has assigned to HPISD property has nothing to do with the sale of property owned by the church. The church can offer its land at any price it wants. Basic supply and demand there.
      DCAD puts values on properties, but until the land is sold, the true value is speculative. Older properties which haven’t been on the market often are extraordinarily undervalued in DCAD. The properties owned by the district aren’t for sale and the district does not pay property taxes so no one cares about the valuation.

      Reply
      • October 30, 2015 at 2:30 am
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        @Really,
        Educate us more please about this novel real estate principle that “no one cares about the valuation” of HPISD’s properties. RBC and HPISD are constantly touting the value of the district’s assets and its debt-to-asset ratio. They say our ratio is so good we should all say YES to higher taxes and hundreds of millions of additional debt and never look back. They say it keeps our paper a beautiful triple A. (But don’t bring up the ratio of debt per student, which is roughly $70k per HPISD student — more than even bankrupt Detroit’s! — should this enormous bond issue pass. That is a ratio the YES people hate.)

        Here’s the thing. Really, we could quibble for a while whether DCAD’s $21.5M appraisal of Northway’s 12 acres is too low or high. But my time spent quibbling re whether DCAD is so far off the mark that $ TWENTY MILLION is truly the FMV for 4.6 acres of a 12-acre parcel that DCAD values at $21.5M? Ends with this sentence. We’ve seen no due diligence and no true price discovery by the Board on the church’s acreage; for HPISD to pay $20M using taxpayer money is obscene.

        And when our ever-loving-money Board invariably comes back for more, to fix what should be our FIRST priority — the HIGH SCHOOL — how pretty will our paper be then, Really?

        [The value of all of HPISD land (roughly $23M) came from the district’s materials ~
        http://www.hpisd.org/Portals/0/docs/business/CAFR_2014_HPISD.pdf (at p. 15)]

        Reply
  • October 29, 2015 at 8:03 am
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    Glad to see folks taking a stand against the wild spending that has been going on in the Park Cities for years. And they call themselves conservatives??? Chuckle.

    As to a (blogger “@Logan’s”) comment about rumors and false claims against anyone against the bond election…….. yes, that has been the tactic of the cowards who do not know what to do with smarter folks who take a stand against the chumps making the political decisions in the Park Cities.

    The rumor spreaders and desperate gossipers prey on the stupidity of others, whom like themselves, have nothing better to do but kissy face up. Chuckle.

    The 4600 block of Southern Avenue has some gossipers, hey? Kissy..kissy.

    Please vote “NO” and do an intelligent bond deal. Yes, all kids deserve better, they just don’t deserve to inherit stupid wasteful debt burdens by agenda setting politicians that will dramatically raise YOUR taxes.

    Reply
  • October 30, 2015 at 10:24 am
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    The sea of Yes signs vs the dearth of Mad for Plaid support – yep if the bond passes and Mad for Plaid fails miserably in collections, just perfect

    Reply

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