GUSTINE - School board members last week gave the Gustine Unified School District’s financial advisor the green light to explore the feasibility of a November bond measure to fund additional school facilities.
A $14 million bond measure approved by voters in 2014 has funded a number of school projects - including a locker room renovation at Gustine High, the newly-completed GMS gym and a variety of safety-related projects.
But the district’s plans to augment the local bond monies with state matching or hardship funds in order to complete additional projects have not yet materialized.
Financial consultant Jon Isom estimated that the district has in excess of $25 million of unfunded projects, including a new science wing and cafeteria at Gustine High, modernization of the high school campus, and new classroom wings at other school site, as well as the potential purchase of property for GHS expansion.
That project list, board member Loretta Rose, does not include a new multi-use room at Romero - which will push the need even higher.
Dr. Bryan Ballenger, district superintendent, noted that Gustine Unified has several projects that have been through the state architectural review approval process and are in line for matching funds from a previous statewide bond measure.
But, he said, if Gustine Unified lacks matching funds - as is currently the case - it would “go to the end of the line and hope that another (state) bond passes.”
School districts rely on school bonds to come up with the required match, Isom emphasized.
“That is just how school districts are funded, period. There is no big pot of money (from the state),” Isom told trustees.
The district is eligible for $12.3 million in matching funds, Isom advised, but he reiterated the need for a local match.
Gustine Unified has benefited from a growing property tax base, Isom said.
That has kept tax assessments from the 2014 bond - Measure P - below the estimated rate of $52 annually for every $100,000 in assessed valuation, he said, and improved the bonding capacity to an additional $27 million.
The district, because of lower-than-anticipated interest rates and the greater taxable value increases, was also able to sell Measure P bonds more quickly than anticipated, giving the district money for projects more quickly and reducing the cost of issuing bonds.
Isom spelled out a variety of scenarios involving bond rates. The tax rates per $100,000 in assessed values would range from $45 for a $20 million bond to $60 for a $27 million bond. That assessment would be in addition to the Measure P levy.
District can take a variety of approaches to a bond, Isom noted. Some go out for lesser bond measures and rely on state matching or hardship funds to complete their projects. Another option is to go for the full amount to cover necessary projects - knowing that the district does not have to sell all the authorized bonds if state matching funds become available.
Ultimately, Isom emphasized, voters have the final say.
The next steps in the process, he said, will be to conduct voter surveys to gauge the level of support, after which time the board can begin the process of deciding whether to go with a bond measure and, if so, in what amount and for what projects.
“I don’t want you do $27 million less $12 and just ask for what the state won’t cover, because then you are putting all of your eggs in the state’s basket,” the advisor told trustees.
“In 2014 we went with the hope of getting matching funds but it didn’t work out,” Rose stated, “If we need $25 million that’s what we ask for.”
Timing is a consideration, Isom advised the board.
“If you don’t go in November 2020 you defer to 2022. If you wait, improvements won’t get done until 2024 or 2025,” he explained.
Another consideration, board members pointed out, is that the district has invested heavily in the plans now in the matching fund pipeline and risks losing that money if the plans expire.
“If we had known it wasn’t going to come through, we would have put that money into our sites,” said Kevin Cordeiro, board president.
Ultimately, the board gave direction to have Isom proceed with an exploratory survey on the feasibility of a November bond measure - but not without some reservations.
“Nobody likes the word ‘tax’. You look at our schools, we need this,” said Cordeiro. “We owe this to our kids. We would have been in a lot better place if the state had held up their end of the deal. That’s the way it is. That’s the cards that were dealt to us.”
Ultimately, board members agreed, the district’s facility needs must be addressed.
“I don’t want to see my tax bill go up,” board member Pat Rocha stated, “but I don’t want to see my high school go down.”