Bond Refusal in Broward County - Frequently Asked Questions

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1 FREQUENTLY ASKED QUESTIONS The SMART FAQS are provided to answer questions regarding the SMART Initiative and will be updated on an ongoing basis. 1. Q: What is a General Obligation Bond referendum and how is it used? A: The Florida Constitution allows a governing body, in this case, the School Board of Broward County, Florida, to go directly to Broward s voters with a referendum to obtain approval for a clearly specified reason. A bond referendum is an opportunity for our community (voters) to decide if the District will be authorized to borrow money through the sale of a bond for the purpose of financing capital projects (school safety projects, repairs and renovations for facilities, and technology infrastructure). Our community has the opportunity to approve the bond on November 4, Q: Why does the District need a bond referendum now? A: In May 2008, the state legislature reduced the tax on property values that provides capital revenues for school districts to address facility and equipment needs from $2 per $1,000 of taxable value to $1.75. In 2009, the legislature further reduced the tax rate by another 25-cents, to $1.50 per $1,000 of taxable value. As a result of the loss of funding, was forced to cut $1.8 billion in capital projects (e.g. renovations, new construction and equipment) for schools and District facilities. In other words, Broward County taxpayers are investing significantly less in education today than they did seven years ago. Our District and other Florida school districts have asked the state legislature to restore the capital millage without success. Other school districts have successfully approved bond referendums to increase school capital SMART FAQs Last revised: July 30, 2014 Page 1 of 5

2 funding. is in need of additional capital funds and is seeking a bond referendum to address critical needs. Forty percent (40%) of the District s school buildings are over 25 years old, and the average age is 27 years old. Just as in homes, roofs, air conditioners, electrical systems, and plumbing have a limited life span and are in need of repair or replacement. The bond will address the following critical areas: School improvements to support student health, safety and security. Technology and technology infrastructure to support student learning, digital environments, and 21 st century classroom instruction. Facility repair, renovation and replacement to ensure quality schools in the community. 3. Q: How will this bond referendum impact a property owner? A: A homeowner in Broward County, whose home is valued at $225,000, will realize an average increase in capital outlay tax of $50.00 per year over the life of the bond. Even with this modest increase, the homeowner s capital outlay tax will still be approximately $ less per year than it was in This means the homeowner will still be paying approximately 26% less in capital outlay tax than seven years ago. A condominium owner in Broward County, whose condo is valued at $105,000, will realize an average increase in capital outlay tax of $20.00 per year over the life of the bonds. Even with this modest increase, the condominium owner s capital outlay tax will still be approximately $72.00 less per year than it was in This means the condo owner will still be paying approximately 33% less in capital outlay tax than seven years ago. SMART FAQs Last revised: July 30, 2014 Page 2 of 5

3 4. Q: Why should Broward County citizens, who do not have children in the school system be concerned about what is happening in the schools? Why should these citizens support the bond referendum? A: Strong public education is the foundation of our country. Excellent schools support a vibrant community and economy, and ensure a well-educated and highly skilled workforce that attracts and retains businesses. School facility renovations generate jobs and grow our local tax base. When schools are improved, this adds value to a community and property values. 5. Q: Specifically, how will the money be spent? What will be accomplished through this funding? A: is conducting an independent needs assessment, using a nationally renowned company, of all schools and facilities. The needs assessment will provide an objective status of the physical and educational adequacy of our schools and administrative sites. This information will provide the basis of current and future capital planning efforts. The bond proceeds will be utilized to address the most critical priorities identified by the needs assessment and will address the following: Safety and security Repairs and renovations Technology and technology infrastructure 6. Q: Will the bond request cover all the identified capital needs in the District? A: No. This bond offering seeks to raise $800 million, which will only cover a portion of the District s most critical capital projects identified through the independent needs assessment of our schools. This approach will allow us to 1) secure funding for our most critical needs, 2) execute effectively on a defined scope of work that is manageable, and 3) does not overburden our taxpayers. SMART FAQs Last revised: July 30, 2014 Page 3 of 5

4 7. Q: Will each school receive a portion of the bond money? A: Yes. Every school will receive funding to support instructional technology upgrades and technology infrastructure to support student learning. $80 million of the bond proceeds will be allocated for technology needs, the remainder of the bond funds will be allocated to address the most critical facilities, health and safety needs. 8. Q: Is bond money used for pay raises or other operating expenses? A: No. Bond funds cannot be used for salaries or operating costs such as utility bills, supplies, fuel or employee benefits. Bond funds can only be used for capital projects. Capital projects include renovations to existing facilities, technology and technology infrastructure, and equipment, such as HVAC units for existing buildings. Capital dollars allow us to invest in Safety, Music & Arts, Athletics, Renovations and Technology (SMART). 9. Q: Will parents and stakeholders be able to identify the needs of each school and how the Bond will address specific deficiencies? A: will engage parents, students and the community in various forums to educate them on both the District s capital needs as identified through the Facilities Needs Assessment, and on how the District intends to use bond proceeds to address the most critical capital needs at each school. The District will maintain ongoing communication and targeted dialogue with parents, business partners and community members throughout the process. 10. Q: How will the District ensure that the money from the bond will be spent appropriately? A: An independent Community Bond Oversight Committee will be formed to review and report on all Bond fund expenditures to ensure expenditures are made consistent with the purposes for which they were authorized. Establishing a Community Bond Oversight Committee will build and strengthen trust with our community and ensure integrity, transparency and accountability throughout the process. SMART FAQs Last revised: July 30, 2014 Page 4 of 5

5 11. Q: Why are we issuing long-term debt for technology? A: The School District will use approximately 10% of the $800 million on technology ($80 million). Additionally, the portion of debt issued for technology will be structured so that the bonds issued for technology will be retired (repaid) over the useful life of the computers and technology (3-5 years). 12. Q: If voters approve the $800 million General Obligation Bond, will that amount of debt overburden the District? A: Over the past five years, the District has retired $300 million in debt. Moreover, the District will continue to retire and reduce debt on an ongoing basis. Relative to this General Obligation Bond initiative, the District will only issue bonds when projects are ready to be executed. The bonds will be issued in several series over five years. The District continues to show discipline and success in retiring and reducing debt on an ongoing basis. 13. Q: Homeowners are experiencing increases in their property taxes because of rising property values, would the General Obligation Bond further increase property taxes? A: Although property values are increasing they remain below 2007 values. The capital outlay tax rate for school capital needs is also lower than it was in Even with the General Obligation Bond included, a homeowner with a home valued at $225,000 will pay approximately $ less per year in capital outlay tax than in This is 26% less than seven years ago. Even with the General Obligation Bond, a condominium owner with a condo valued at $105,000 will pay approximately $72.00 less per year in capital outlay tax than it was in This is 33% less than seven years ago. SMART FAQs Last revised: July 30, 2014 Page 5 of 5