Nevada County Picayune and Gurdon Times Newspaper Archive

Millage rate remains up for board discussion

The Prescott School Board finds themselves in a serious situation regarding funding options for serious mandated facility repairs and renovations. The board met on June 6 but made no decisions on the subject. Instead, board members set another special meeting for June 13. At that meeting, they were to allow the public an opportunity to express opinions and ask questions regarding the issue.

During the June 6 meeting, the board heard from financial consultant Ray Beardsley, vice president of Beardsley Public Finance. Beardsley said the problems in the Prescott School District are not unique, but are being faced by districts across the state. The state is mandating unfunded and partially funded projects to all school districts, Beardsley said.

This is a reality in many places, he said.

Prescott Superintendent Hyacinth Deon said the state mandates are difficult to meet.

Every time the legislature meets, they come up with new rules, she said. Theyre going to meet in 07. That scares me.

Beardsley said the Prescott district is not in a position to reduce costs. Salaries  in most districts including locally  make up more than half the districts operating budget. Those are largely mandated. The district has little short-term debt and no long-term debt that can currently be renegotiated to save on annual payments.

The district also cant expect any increase in revenue based on student enrollment. Beardsley said his figures indicate that the district has lost 91 students over the past two years. Looking back for five years, the district had an increase one year but is down a total of 68 students over that period of time.

Deon said the districts growth projection is flat for the coming year.

That to me is the most frightening thing, she said.

Beardsley said the district is in a serious situation. If the district doesnt do maintenance and repairs on the existing buildings, the state can declare the district in a state of facilities distress. And if the district overspends, the state can declare a state of fiscal distress.

The only real option out there is to increase mills, Beardsley said.

Beardsley suggested that the board consider asking voters for a 4.7 mill increase. With the proceeds of that increase, the district could enter into a 22-year bond agreement and would raise $1 million for projects over a three-year period. He said that millage increase would also increase the districts annual cash flow.

Beardsley said he would bring back figures on any millage increase the board wanted.

To truly help you, you need 4.7, he said.

Beardsley told the board that a millage increase voted in now would go on the books with the county tax collector next year, and reminded the board that the money wont instantly become a reality for the district. With that in mind, he recommended that the board make a decision before the end of June.

The longer you wait, the longer before the district begins to get the money, Beardsley said.

During a recent board meeting, Deon recommended that the board take out a loan of a half million dollars to meet the projects identified for the current school year and for the 2006-07 school year. The board declined that recommendation and instead voted to borrow the money needed for the projects that were to be completed before September of this year.

Prescott School Board Vice President Shane Meador and board member Jo Beth Glass were both in favor of funding only the current projects and giving the board time to decide what should be done to fund those slated for the coming school year. Glass said that she wasnt comfortable making debt that she wasnt certain the district could make.

Meador pointed out that Beardsleys plan is to ask for a 4.7 mill increase that would bring in $1 million, but that $1 million must be used over a period of three years. Meador said his concern is how the district will fund projects for the subsequent years.

The voters will only go so far, he said.

During the June 6 meeting, Beardsley said, As much as youd like to look forward and plan down the road, you really cant. Weve got to look at what we can do now.

I dont want to run into three years down the road and be looking at closing our school down, Glass said.

The critical issues, as much as facilities right now, is cash flow, said Beardsley. The facilities are important for sure, but the cash flow is more important, at least in my mind.

Deon had told the board during a recent meeting that the districts ending balance for the 2006-07 school year would be higher than the ending balance for the current year. The board requested no clarification on this point and Deon made no comment.

The board agreed to hold a workshop on June 13 at 5 p.m. to gather more information about the facilities requirements, and to hold a public session at 6 p.m. to hear comments from the public regarding the possibility of a millage increase.

What if it doesnt pass? asked Glass. How will we cover these requirements?

You wouldnt be able to, said Deon. She said the only other option would be to incur additional short-term debt.

The longer you put it off, the more its going to cost, said Sandra Tatum.

But you cant do it if you cant pay for it, Meador said.

You have to, Tatum said.

In other business, the board voted to accept the transfer of one teacher. Following the board meeting, Deon acknowledged that a Prescott faculty member is being investigated regarding an alleged incident involving a student. Deon said the query at this point is internal, Deon said. She said there would be no action on the allegations unless they could be substantiated