Bond and Override

• What is a bond?

  A bond is a voter-authorized funding mechanism that enables a school district to incur debt to finance one or more of the following:

  • Acquisition or lease of sites (WESD not acquiring land)
  • Construction or renovation of school buildings
  • Improving school grounds and District facilities
  • Purchasing pupil transportation vehicles
  • Purchasing furniture, fixtures, technology and equipment, if paid for within five years

  Principal and interest on the debt is repaid over time through secondary property taxes.

  Why consider a bond election?

  WESD has critical capital project needs throughout the District. Delaying such projects could increase the severity of needs and the eventual cost to address them. In some instances, safety could even be jeopardized. A task force of staff, parents and community members met during February March, and April 2022 to study these needs and recommend appropriate action. The group’s recommendation is that the Governing Board call for a bond election to take place in November 2022.

  Who will decide if WESD will have a bond election?

  The 2022 WESD Bond Task Force presented a summary of its work to the WESD Governing Board on May 26, 2022. During that meeting, Board members voted to call for a bond election.

  If approved, how will the bond funding be used?

  The 2022 WESD proposed bond plan includes the following capital projects:

  • Safety projects
    • Lobby safety improvements
    • Special systems (Fire, intrusion, card access, surveillance)
    • Door hardware improvements
  • Building system upgrades and replacements
    • HVAC
    • Plumbing/Storm/Irrigation
    • Electrical
    • Flooring/interior finishes
  • Site Upgrades
    • Grounds improvements
    • Concrete/asphalt upgrades
    • Marquees
  • Technology
  • Pupil transportation
  • Renovations/campus modernizations
  • Window system replacements

  If the bond is approved, how many schools will benefit?

  Every school in the Washington Elementary School District will benefit; some schools will be impacted to a greater extent and others to a lesser extent based on identified needs.

   How were the potential bond projects determined?

  WESD’s Business Services Department oversees the development of the District’s Capital Improvement Plan, which includes facilities, technology/infrastructure and large equipment/vehicles to transport students. The building condition of each structure on WESD campuses is consistently monitored and periodically assessed by the District’s Capital Projects and Maintenance Department and consultants to evaluate structural and safety needs. Additionally, schools and departments submit site improvement requests as part of WESD’s annual budget process. Technology/infrastructure needs are evaluated by the District’s Management Information Systems Department, and large equipment and bus needs are monitored by the Transportation Department.

  Once capital needs have been identified, they are prioritized to determine which are to be included as potential bond projects. Prioritization is based on student safety; code compliance; age and condition of building systems and equipment; availability of parts and ability to maintain equipment using internal resources; and alignment of needs with sites’ continuous improvement plans and the District’s strategic plan.

  Why are school buses included as part of the proposed bond election?

  Arizona statute specifies that proceeds from the authorization of school improvement bonds may be used to purchase pupil transportation vehicles. According to WESD’s bus replacement plan, a given bus is to be cycled out at fifteen years of age. Currently, 9 of the District’s 120 buses (7.5%) are overdue for replacement.

  Are there funding sources other than school improvement bonds that could be used to support repair/renovation of school facilities?

  District Additional Assistance is capital funding that school districts are allocated by the state of Arizona based on a statute-driven, per-pupil formula; however, between 2009 and 2020, the amount districts have received was reduced each year. District Additional Assistance funding to WESD has been reduced by over $41 million since 2009.

  Beginning in 1999, Building Renewal funds were allocated annually to districts to maintain existing school facilities and keep them in good working condition; however, the AZ Legislature fully funded Building Renewal for only one year, partially funded it during other years and discontinued it completely in fiscal year 2014. WESD did not receive $27 million of allocated Building Renewal funds during these years.

  Building Renewal Grants currently offer funds for which districts may apply when equipment or systems fail; however, only $150 million is available statewide each year for this purpose.

  Other grants and donations may provide a small amount of funding for capital needs; however, these are not consistent sources of revenue, and they sometimes impose long-term requirements on a school district.

  What is the history of school improvement bond elections in WESD?

  WESD has had successful bond elections in 1996 ($114.7 million), 2001 ($64 million), 2010 ($65 million), and 2016 ($98 million)

  How did WESD use the funding that was authorized by voters in the District’s 2016 bond election?

  In November 2016, voters authorized WESD to sell up to $98 million in school improvement bonds. Bond funds have been spent and will continue to be spent for the purposes that were identified in the 2016 voter information pamphlet. The following is a recap of completed 2016 bond projects, projects in progress and budgeted items:

  • Special System (est. $4,705,750)(Districtwide)
    • FF&E AV systems
    • FF&E Stage curtain-lighting
    • Marquee replacement
    • Special system – fuel system
    • Security and surveillance systems
  • Technology (est. $20,651,200)(Districtwide)
    • Infrastructure, such as cabling, servers and switches
    • Classroom interactive technology
    • Intercom – Bell systems
    • Backup storage/ servers
    • IP video distribution
    • Telephone systems
    • Classroom computers
  • Building system upgrades and replacements (est. $59,740,350)(Districtwide)
    • HVAC and controls replacement
    • Roofing
    • New Construction
    • School office renovations
    • Security and surveillance systems
    • School intercom systems
    • Playgrounds and shade structures
    • Flooring
    • Window system replacements
  • Site upgrades (est. $5,926,791)(17 schools)
    • Fire lane replacement
    • Parking lot renovations
    • Playgrounds and shade structures
    • Site circulation
    • Waterline rerouting
    • Asphalt upgrades
  • Pupil transportation (est. $5,000,000)
    • Replacing aging buses

  Could school improvement funds generated by a school district bond election be taken by the state of Arizona?

  No, all money collected from taxpayers is deposited directly into the school district’s accounts to fund voter-approved bond payments. By law, the money cannot be diverted into the state’s general fund.

  If approved, how will the $135 million bond election impact my property taxes?

  For property owners within WESD boundaries, the current year (2022-2023) total bond tax rate is $.91 per $100 of assessed valuation; the estimated 2023-2024 total bond tax rate is $.91 per $100 of assessed valuation.

  If the bond election is approved, how will WESD minimize the property tax impact on homeowners?

  District policy states that WESD’s “Governing Board is committed to responsibly managing the District’s debt issuance activities on behalf of taxpayers.” WESD will strategically time the issuance of bonds to align with scheduled capital projects and expenditures.

  What will happen if the bond doesn’t pass?

  If the bond doesn’t pass, the recommended capital projects will have to be delayed, unless alternate funding sources can be identified.  As indicated in FAQ #2, delaying such projects would likely have negative repercussions.

Maintenance and operations or M&O funding is one of Arizona school districts’ funding “buckets,” each of which can be used only for purposes specified in state statute.  M&O funds pay for most of a district’s day-to-day expenses, including employee salaries and benefits, utilities, transportation, purchased services and supplies.

2. What is a maintenance and operations (M&O) override?

An M&O override is a special election, called by a school district governing board, which asks voters within the district to approve additional maintenance and operations funding for their local schools, earmarked for specific educational purposes and generated through local property tax levies.  The maximum amount for an M&O override is 15 percent of the district’s Revenue Control Limit (budget expenditure limit).

3. Would this be a new tax?

No, this would be a continuation of WESD’s current 15 percent M&O override tax levy. The estimated first year tax rate is $1.35.

4. What is the current cost to WESD taxpayers of the District’s 15 percent M&O override?

The current cost for the M&O Override is about $123.70 per year (or $10.30 per month), per $100,000.00 of assessed valuation. 

5. If approved, is an M&O override permanent?

No, an M&O override lasts for seven years.  It is fully funded for the first five years; however, if not renewed by voters, funding is reduced by one-third for the sixth year, by an additional one-third for the seventh year and completely eliminated at the end of that year.

6. If WESD calls for an M&O override election and that election is successful, could the State of Arizona redirect the District’s M&O override funds to the State’s general fund?

No, override funds go directly to the school district to be implemented according to the district’s override plan.  These funds cannot be cut by the state or swept into the general fund to be used for other purposes.

7. Who will decide if WESD will have an M&O override election?

The recommendation is the culmination of weeks of research, analysis and discussion by the seventeen member task force, which included parents, community members, teachers and administrators.  Following the presentation, Board members will determine if they will call for an election.

8. If the WESD Governing Board calls for an M&O override election, when will the election be held?

The Governing Board called for an M&O override, the election will be held on Tuesday, November 8, 2022.

9. If the WESD Governing Board calls for a 15 percent M&O override election and the election is not successful, what will happen?

If a 15 percent M&O override election in November 2022 were unsuccessful, the current 15 percent M&O override would continue until it expires. The 15 percent M&O override funding would be reduced by one-third for 2024-2025, by an additional one-third for 2025-2026 and completely eliminated at the end of that year. Ultimately, current student programs and services, including free full-day kindergarten, gifted, art, music and physical education, could be severely reduced. A significant number of teaching positions may have to be eliminated, resulting in larger class sizes and greater responsibilities placed on continuing staff.