Editor’s note: La Cañada Unified School District Superintendent Wendy Sinnette offers answers in response to eight questions about Measure LCF posed in a letter to the editor published in the Oct. 19 edition of the Outlook.
A letter posed several good questions about Measure LCF. We believe all local voters should have the information they need to cast an informed vote. Below are the questions posed and answers.
Q. Is there a published list of specific projects that will be funded by Measure LCF?
A. Yes. Measure LCF is the result of a Facility Master Planning process we conducted over the past year. This plan was developed with input from more than 350 parents, teachers, staff, students and community members and was unanimously adopted by the Board of Education at a public meeting in June. This 202-page document, which is available at lcusd.net, includes detailed descriptions, drawings and cost estimates for the projects. A summary of these same projects is also included as an exhibit in the legally binding text of Measure LCF, the full text of which can be found on pages 17 and 18 of the official sample ballot.
Q. Will the new bonds pay off existing bond liabilities?
A. LCUSD has approximately $20 million in remaining debt from prior bond issuances that will continue to be paid off according to the repayment schedule. Measure LCF is designed to issue new bonds as old bonds are paid off, such that there is no net increase in the taxes paid by local property owners. Thus, Measure LCF extends local bond tax rates to fund the next round of school facility improvements, but does not increase tax rates beyond what is already paid.
Q. What is the approximate interest rate and term?
A. Measure LCF is designed to take advantage of our district’s excellent credit rating, resulting from decades of sound fiscal management. The plan assumes issuing “AA” rated municipal bonds at an average interest rate of 4.55% for a period of 30 years from the date the bonds are issued.
Q. Without Measure LCF, would tax rates otherwise decrease?
A. As stated above, Measure LCF is designed to issue new bonds as old bonds are paid off so that taxes do not increase beyond what local property owners already pay. Without Measure LCF, taxes would decrease in the future as old bond are paid off, but our district would be left without funding to complete needed upgrades to classrooms and school facilities.
Q. What percentage of the bond cost falls on residential and commercial property owners?
A. By law, bond measures must be repaid based on a tax rate applied uniformly to the assessed value of taxable properties throughout the school district. Given the nature of our community, approximately 92% of the assessed value of properties is residential, about 5% is commercial and the balance is a mix of industrial, governmental and institutional properties. The cost of the bond follows this same distribution as required by law.
Q. Will ongoing building maintenance be paid for out of the bond or other sources?
A. We are required to spend 3% of our annual budget on routine maintenance of facilities. Our district has often contributed more than the minimum required to cover costly projects like replacing outdated heating and ventilation systems, replacing roofs and other large projects. As bond funds are used to repair or replace aging facilities and building systems, fewer dollars from our budget will be required for facilities and those savings can be utilized for instructional programming. However, we will continue a maintenance budget to protect the taxpayers’ investment in our school facilities.
Q. How do “state matching funds” work?
A. The state of California has a limited pool of dollars that are available to local school districts through a competitive application process. Districts may qualify for these funds if they have local matching dollars. Measure LCF would provide the local matching dollars needed to maximize the chances of our district qualifying for state matching dollars instead of allowing this funding to go to other districts. LCUSD’s facility plan and Measure LCF assume only limited state matching dollars to be conservative. To the extent that our district does qualify for matching funds, additional projects can be completed or the cost of the facility improvements to local taxpayers can be reduced.
Q. What legal/financial firms stand to benefit?
A. LCUSD utilizes Fieldman Rollapp and Associates as our financial advisor and Stradling Yocca Carlson and Rauth as our municipal finance attorneys for the development and issuance of bonds. It is our understanding that their compensation is consistent with industry norms.
We hope this information is helpful and encourage all voters to visit LCUSD.net and click on “Facilities Operations” to view our Facilities Master Plan or to contact us with any questions.
Wendy Sinnette, Superintendent
La Cañada Unified School District