CAPITAL FUNDING NEEDS Horizon Council Presentation April 22,

CAPITAL FUNDING NEEDS Horizon Council Presentation April 22,

CAPITAL FUNDING NEEDS Horizon Council Presentation April 22, 2015 District Funding Structure

Operating Funds-for day to day operations of the school district Federal grants-for specific purposes or specific populations as defined in the grant Capital dollars-for purchase of new buildings, land, technology, and maintenance of capital assets THE CHALLENGE

Current capital plan is balanced in five year window Capital plans over last several years have been built based on what we can afford Many items that are now desperately needed are not reflected in the plan (unfunded capital needs)

THE CHALLENGE UNFUNDED CAPITAL NEEDS District Technology initiatives Necessary infrastructure Student devices Replace/refresh plan for new devices

THE CHALLENGE UNFUNDED CAPITAL NEEDS Maintenance/Renovation Initiatives Necessary maintenance on older buildings Safety upgrades Building upgrades THE CHALLENGE UNFUNDED CAPITAL NEEDS Classroom Availability/Need for Seats

No new schools in the current plan in the five year window Growth continues at 1.5-2.3% per year Many schools at or very close to capacity Shortfall: $45 million per year The Challenge

Tax roll loss between 2009 and 2013: $400 mil Impact fees down from a high of $57 to $1.4 mil Capital dollars from state from $21 to $1.5 mil Total annual revenue from $264 mil in 2008 to $103 mil in 2015 FIVE YEAR IMPACT $656 MILLION Meeting the

Challenge Need viable options to generate capital revenue Determine ways revenue needs can be met How much revenue could be raised Pros and Cons of our available options OPTIONS Option 1: Additional property tax capability Ask the legislature to give us the capability of increasing

property tax back to 2.0 (or at least higher than the current max of 1.50) Each .25 mill generates approximately $15.5 million based on current tax roll Must depend on the legislature to give us this capability Additional tax is paid entirely by local property tax owners OPTIONS Option 2: General Obligation Bonds --The sale of bonds, the debt service of which will be

paid back through revenue generated from an additional property tax levy Revenue potential is substantial, dependent on the size of the bond Must be agreed to by voters in a referendum This is an additional property tax, so again, the local taxpayers bear the brunt of the expense OPTIONS Option 3: COPs Currently, the District has over $505 million in

borrowing capacity (based on using 1 mill for debt service) Board has expressed interest to stay away from more borrowing Currently use 46% of property tax revenue for debt; more debt would increase this amount Limitations on how that money could be used OPTIONS Option 4: Restoration/increase of impact fee Revenue before reduction was $4 million

Authority is outside of board control Other options could raise more funds Limitations on how funds could be used OPTIONS Option 5: Sales Tax Potential of raising $50 million per year based on current sales tax collections Revenue is raised by a broader population (23% of sales tax collections come from tourism) Additional money is not acquiring new debt

Must be approved by voter referendum OPTIONS 56 out of 67 counties have some sort of sales

surtax benefitting various county/district/government operations 15 counties have a school district sales tax 18 counties have a local government infrastructure tax that could be shared with school districts by agreement 23 counties have other sales surtaxes

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