MILLERSPORT – “Now we can focus on delivering better education,” Walnut Township Board of Education President Vince Popo told The Beacon Wednesday.
Voters narrowly renewed a 1.7 mill emergency levy for five years by an unofficial 416-388 vote Tuesday. Presidential primary voters on March 15 had rejected the first renewal attempt by an official 832-657 tally.
The 20-year old levy raises $250,000 a year for district operations.
“I’m pleasantly surprised,’ Popo added. “If I could, I would be doing cartwheels.” Popo said he was concerned when postcards detailing property value updates arrived in district homes Monday.
Superintendent Randy Cotner had a similar reaction. “It is a weight off our shoulders and we can now focus on education,” he told The Beacon.
“We’re happy,” he added. “We were in a big hole. Last year’s levy got our head above water and this will help us keep it there. We shouldn’t be on the ballot for four years and then just for renewals”
Last August, voters approved an additional 7 mill levy that raises about $1 million a year. The effort to eventually get that levy approved included the loss of a long-standing 1.8 mill emergency levy that brought in $257,000 a year. That cut the net gain from the new levy to about $743, 000 a year.
Last March, Cotner blamed the loss on bad timing. He specifically mentioned the higher property tax bills property owners received before the election that reflected the additional 7 mill levy approved by voters in August 2015. The approval kept the district out of fiscal emergency which would have turned its financial decision-making over to a five-member board. The approval also allowed the district to restore a few of the cuts made to eliminate a projected year-end deficit.
Wednesday he said, “I would like to think that most people got the message that this was a renewal.” Tax bills may actually decline a bit as the $250,000 will be collected over a higher district property valuation which will slightly lower the millage or tax rate.
Both Cotner and Popo thanked voters and the levy committee. “It would have been a shame to lose that levy,” Popo said.
“It is a great day,” Cotner said. “A big thank you to our supporters. They’ve given our students a brighter outlook on their future.”
In other district business, board members unanimously took the first step at special meeting July 25, to refinance the district’s outstanding Certificates of Participation (COPs) bonds that were issued in 2008. The bonds raised about $3 million to fund facility projects such as roof replacements, HVAC upgrades and the district’s new all-weather track.
Marvin Founds, a public finance banker with Fifth Third Bank, evaluated the economics of refinancing the approximately $2.3 million in debt last year. It didn’t make sense then, he said. “Rates have dropped lower this summer,” Founds explained.
The minimum Net Present Value savings should be 3 percent, he told board members. It didn’t meet that criteria last year but was calculated in May at 4.68 percent.
Popo asked if refinancing would extend the life of the loan. Founds said it won’t with all bonds being repaid by 2032.
Founds calculated the Net Present Value saving as $106,604 over the remaining life of the bonds. That estimate was done in May and the savings to taxpayers would be higher if calculated today, he said.
The board’s approval Monday night starts a 30-45 day process before the new interest rate can be locked in. Founds also calculated the NPV savings sensitivity to possible interest rate changes. A .25 percent drop in interest rates would increase the savings to $150,245 while a .25 percent increase would cut savings to $64,325. If that would happen, Founds would likely recommend putting refinancing on hold.
Board bond counsel Becky Princehorn of Bricker & Eckler also spoke to the board. “This is a historic low point for tax exempt financing.” She added that the terms are the same as in 2007 – “It is a lease, lease back.”
In response to a question, Founds said the bonds will be sold in $5,000 increments. While anyone can buy them from Fifth Third, the likely buyers will be banks and insurance companies.
Popo moved to approve the two resolutions which were unanimously approved.
“We take saving money very seriously,” he explained.