Introduction of New Interim Superintendent
Board of Education President Sonali Patil introduced Dr. Joseph Porto, one of the two new interim superintendents. Dr. Porto was formerly the superintendent for Avoca School District 37 in Wilmette. He will share the position with Dr. Mark Friedman, a former superintendent of Libertyville School District 70. Ms. Patil explained that the reason two interim superintendents were hired is because the Teachers Retirement System (TRS) rules stipulate that an interim superintendent can work only 100 days or 500 hours, and it was thought that 100 days would not be enough to effectively cover the district. The district can gain from the expertise of both superintendents. Dr. Porto and Dr. Friedman know each other well and look forward to working together.
Kristin Forsberg provided a presentation on BoardDocs, a paperless-meeting and board management system used by governments, municipalities and school districts. She explained some of the benefits of the system that would increase transparency and provide the public with easy access to board documents. The program could go live as early as August. During the Business Meeting, Board members approved the program, which would cost approximately $4,000 annually.
Elizabeth Hennessy, the managing director at Raymond James, gave a presentation on bond restructuring, refinancing and tax implications. She reviewed debt service payments and presented two strategies for moving forward with the referendum options:
- Option A reviewed an in-place refunding of the callable portion of the outstanding referendum bonds, where the new refunding bond maturity does not exceed that of the existing bonds and interest savings are generated.
- Option B looks at refunding of both the callable and non-callable bonds in the years where those payments are growing, and then restructuring those bonds by extending the maturity by five years in order to flatten the current debt service payments. This strategy would lower the annual payment for tax payers over the next seven years but cost more in interest over the life of the bonds.
The district is currently looking at three building referendum options:
- Option #1, the Updated Adopted EFMP, includes renovations and additions at Middle School North, Middle School South, Aspen Elementary, Elementary North, Townline Elementary, School of Dual Language, the construction of the kindergarten building at the Sullivan Center, but no library renovations for $52.3 million.
- Option #2 includes the renovations and additions at the buildings included in Option #1, the construction of the kindergarten building, and library renovations at $57.8 million.
- Option #3 includes the renovations and additions to the buildings included in Option #1, the construction of the kindergarten building and STEM centers in the middle schools, but no library renovations for $48.7 million.
Ms. Hennessy also broke out the financial impact of the referendum options on different home values. For instance, if option #3 is selected with the B refunding option, the estimated annual cost to a homeowner of a $350,000 house on average over the life of the bonds would be $317. This compares the current debt payment schedule to the proposed repayment of the $48.7M with refunding option B resulting in payments that are lower than the current payments in the first seven years and extended at the same or lower payment amount over the remaining 17 years. The referendum bonds would be issued annually as needed to fund the Updated Adopted EFMP over the next five years.
Additionally, Ms. Hennessy said that the board is considering the resolution of intent to issue $1.5 million in working cash fund bonds. The bonds are intended to address the capital needs of the district. A number of repair projects have been identified in the District’s Working Capital Plan. These are non-referendum bonds paid from the debt service extension base. Tax payers could expect a nominal increase in taxes of about $12 on a $350,000 home.
The board also discussed the need for a tax rate increase to fund the operating expenses associated with the additional space provided by the referendum. The district administration estimated that based on the proposed building referendum plans, the additional operations and maintenance cost of the expanded facilities will cost approximately $1.3M per year. This would require a limiting tax rate increase of $.10 per $100. The cost would be approximately $111 annually for a $350,000 market value home.
Educational Facilities Master Plan Refinement
The board members discussed the three different referendum options in the context of Ms. Hennessy’s presentation. The members were unanimous in their support of Option #3, which includes adding STEM centers at the middle schools but no library renovations. They supported Ms. Hennessy’s option B refunding strategy, which she also recommended as being more attractive for tax payers.
Board members felt that the community understood the need for expansion given that the district’s buildings are full. They expressed the need to continue to make cuts to show the community they are being fiscally responsible.
The members plan to finalize the referendum questions at the July 23 meeting. They are looking at putting two questions on the November ballot. The first would ask for funding for option #3B. The second would be for $1.3 million to cover the additional operational costs for the expanded facilities.
Ms. Sonali mentioned that the Hawthorn Enrichment Institute summer program had started at Townline Elementary. She reminded the community to attend the Residency Event, which will take place August 1, 2 and 6. And, she encouraged parents to turn in health forms or physical and immunization records as soon as possible.