Phillips
Bartholomew Consolidated School Corp. officials are recommending that the district move forward with plans for roughly $300 million in facilities projects but scrap the idea of pursuing a referendum to help fund the work.
Administration leaders presented this idea to the school board at a special meeting on Monday, with board members voting to approve publication of a notice for preliminary determination hearings in November and December. The latter meeting is expected to be the point at which the board makes a decision on which funding option to pursue and how high the maximum bond amount should be, BCSC officials said.
In late July, BCSC officials announced that they were working on a proposal for a capital referendum to potentially fund a number of facilities projects. The complete list of projects that might be funded through this method came out to an estimated total of $306 million, including:
- A new westside elementary school.
- Renovations to remaining elementary schools (excluding Parkside and Schmitt, where work is already underway).
- Significant renovation at Northside Middle School and tech/equipment updates at Central Middle School.
- Additions and renovations to both Columbus North and East high schools to meet career and tech education demands.
- Physical education/extracurricular expansions at the two high schools to meet demands.
- Relocation of Bright Beginnings Early Learning Center to the R.L. Johnson Building, relocation of Columbus Virtual Pathway to the McDowell Education Center, and relocation of C4 Cosmetology to expanded space at East.
Assistant Superintendent Chad Phillips said that while the school corporation did not plan to raise the tax rate under the referendum, individuals who are at tax caps would have seen an increase on their bills if a referendum had been successful.
According to Mike Schumaker with Stifel Public Finance, it’s estimated this would be an increase of $52 a year for a home with a gross assessed value of $150,000 and $330 per year for a home with a gross assessed value of $250,000.
Since announcing the possibility of a referendum in late July, BCSC officials have held 20 community group meetings, three staff input sessions, five public input sessions and seven internal stakeholder group meetings. More than 400 people were reached during the process, school officials said.
Throughout the sessions, officials found that there was “broad support” for all projects. However, members of the public would prefer that BCSC choose the “least disruptive financing option” so that no residents see an increase in their taxes.
Community members were also concerned that if BCSC pursued a capital referendum, it might affect the school corporation’s chances of successfully seeking renewal for the operating referendum that was passed in 2020.
The operating referendum helps fund raises for teachers and support staff, STEM lab teacher salaries and benefits, and expenses related to safety, security and mental health. Phillips said that the community would likely vote on its renewal in 2028 at the latest.
After hearing the public’s input, BCSC administration officials are now recommending that the board pass a resolution to issue bonds for all proposed projects (with a not-to-exceed amount of $306 million); not raise taxes for any property owners; and not pursue a capital referendum.
The state of Indiana’s process for a capital or “controlled project” referendum — which is different than the operating referendum passed by voters in 2020 — is a bit complicated.
According to the Indiana Department of Local Government Finance (DLGF), a controlled project generally includes any project financed by bonds or a lease payable by property taxes. The local public question/referendum process applies to controlled projects that meet certain criteria.
School officials said that while BCSC’s project list would be subject to the referendum process due to its estimated cost, that doesn’t mean that they have to seek a referendum in order to complete the proposed projects.
“If there is not a signature drive, if the signatures are not collected, then this would not appear on the ballot in May or November or whatever,” Phillips said.
If the board passes a resolution authorizing BCSC officials to issue bonds up to a certain amount, and neither the school corporation nor the public chooses to collect the signatures needed for a referendum, the district is able to move forward with issuing bonds after an initial waiting period and some various legal steps, he said.
School officials have said that BCSC plans to avoid raising tax rates by timing debt from the new projects with the roll-off of existing debt, and this can be done without a capital referendum.
Phillips said the trade-off for the district is that referendums are not subject to property tax caps and can also capture assessed value from Tax Increment Financing districts. It’s estimated that, without the referendum, BCSC will collect $15 million less in revenue over the next eight years due to tax cap losses, though he noted this is difficult to predict.
Additionally, BCSC can mitigate these losses by reducing the amount budgeted for smaller capital projects each year, he said.
Superintendent Jim Roberts added that the extra revenue from the referendum is beyond what they necessarily need in order to complete the renovations.
If BCSC put a referendum on the ballot and it failed, everything would have to be put on hold while the community and school corporation regroup and come up with a new strategy, Phillips said. BCSC wouldn’t be able to complete projects that cost enough to trigger the referendum process, which would mean that the new elementary school — estimated to cost roughly $60 million — would be off the table, at least for a time.
According to the DLGF, following a failed referendum, a political subdivision cannot pose another public question on the same or “substantially similar” project earlier than 700 days after the election — or 350 days if officials can get enough signatures on their petition.
In discussing next steps, Phillips said the notice for Nov. 13 and Dec. 11 preliminary determination hearings will not include a dollar amount but will include a project description, as well as the time, date and location for the hearings.
According to BCSC officials, the immediate next steps are for the board to establish a project scope and maximum bond limit, conduct the public hearings, and adopt project resolutions in December.
Next steps after that will include working with the community to set priorities, said Director of Operations Brett Boezeman. Then, in the long term, the board’s work will include:
- Defining project priorities and schedules.
- Final approval of scale and scope, bids and contracts.
- Community districting process.
- Annual review of project and bond status.
Phillips added that BCSC doesn’t plan to issue all $306 million in bonds next year. Instead, they plan to meet with the board every fall to discuss assessed value, interest rates and which projects to prioritize.
“Every year we would issue some set of bonds, up to the maximum amount authorized by this action taken by the board, potentially as early as the December 11 meeting,” he said.
Phillips added that the needs of the community will continue to evolve over time, which will likely mean changes for the projects they’ve outlined.
As the board considered the administration’s recommendations, board member Jason Major voiced some concerns about the estimated costs of projects. He questioned whether BCSC’s estimate of $114 million would be enough to renovate its remaining elementary schools, while also stating that he felt $62 million was too much for physical education and extracurricular improvements at East and North.
Overall, he felt that $306 million was a large price tag and suggested that the school corporation should examine possible alternative solutions that might help to reduce project costs.
Board member Logan Schulz also had some questions about the board’s financial assumptions and requested information on details such as changes to assessed value over time, debt utilization, and the breakdown of costs for the various projects.
