Traverse City Record-Eagle

July 24, 2013

Delayed TCAPS projects back before voters


— TRAVERSE CITY — Voters might wonder why three elementary school reconstruction projects approved in 2007 as part of a $105-million Traverse City Area Public School bond proposal are slated to be back on the ballot again this November.

The short answer is property values unexpectedly declined with the economic recession, and the 2007 renewal of TCAPS 3.1-mil millage rate didn’t generate the tax revenue district officials originally expected.

“As a result some of the large-ticket items, the elementary school reconstructions had to be delayed,” TCAPS Chief Financial Officer Paul Soma said.

TCAPS and other school districts in Michigan raise money for capital improvement projects by selling bonds to lenders who are then paid back with interest over time. Voter-approved millages fund the repayments.

Most public school districts in the state ask voters to approve a certain dollar amount and an estimated millage rate to pay off bond sales. The true millage rate -- and the amount taxpayers pay every year -- is then dictated by the market, Soma said. If property values go down, millage rates go up.

TCAPS does things differently. Its officials include a true millage rate in ballot proposals. If voters approve the millage request they are guaranteed to pay no more than that actual rate regardless of what the markets do.

TCAPS Board of Education Treasurer Erik Falconer said the practice promote transparency and accountability.

“It’s fair to our community,” said Falconer, chair of the board’s finance committee. “We have to be accountable to the community and we’re forcing ourselves to do it.”

TCAPS officials also sell off bonds in several series instead of all at once like most districts. The practice allows for more structured and consistent long-term capital planning, Soma said.

It also allows officials to slow capital improvement projects in order to avoid raising the millage rate, which is what happened with the reconstruction projects at Eastern, Glenn Loomis and Interlochen elementary schools, and some school bus replacements also included in the 2007 renewal proposal.

The three school reconstruction projects now make up the bulk of a .2-mil, $35-million bond proposal voters will see on the ballot this November. A separate ballot question will ask voters to approve .09-mil to construct an auditorium at Central High School.

District officials can get the reconstruction projects back on track and continue annual bus replacements and technology upgrades if voters approve the measure, Soma said.

If they don’t approve it, some items might have to come off TCAPS’ extensive capital projects list.

Board of Education Vice President Julie Puckett Hopes school board members won’t need to consider that option.

“The board would have to evaluate everything on the table if the bond failed to pass and I don’t want to speculate on how that would go,” Puckett said.

Some of the completed projects from the 2007 millage renewal included multi-million dollar renovations to Traverse City Central and West Senior high schools, and construction of an $8.9-million Long Lake Elementary School.

Today, that school sports classrooms equipped with needed technology and updated safety features, like a centrally located entrance near the administration office and security cameras.

The reconstruction projects on the 2013 ballot will bring other elementary schools up to the same level of quality, said Paul Mahon TCAPS director of capital projects and maintenance.

“There’s a lot of benefit in having those things,” Mahon said. “It gives the staff and students the ability to deliver a good education, whereas they are truly limited by some of the infrastructure of older buildings.”