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Ellis: School Board Needs Decisive Action on Bond Debt

TaxFACTS member Sandy Ellis challenges Geneva School District 304 to form a more aggressive policy to reduce debt, tax impact.

  • Editor's Note: This is a portion of a statement made by Geneva resident Sandra Ellis at a recent Geneva School Board meeting. It is submitted here as a letter to the editor at Geneva Patch.

District 304 property taxpayers are burdened with paying off a heavy but legally binding bond indebtedness to build additional facilities. The actual change in enrollment did not justify construction of new facilities. Incurring that level of debt was a serious mistake.

The Board of Education was elected to serve as the taxpayers' representative. The board must insure their management of the School District does not impose an "eviction-by-property-tax" condition on the community, particularly those on fixed incomes. 

As the process of adopting a new budget begins, the board must find ways to offset the cost of the mistake when budgeting variable expenses for the upcoming fiscal years. It’s a matter of fairness.

An examination of district financial information shows a significant offset may be accomplished—without detracting from the basic education program—by addressing the unreasonably sharp increase in expenditures for certificated staff services during the past five years (FY ending 2008 to FY ending 2012.)

Over that brief period of time, budgeted expenditures for basic instructional services have increased by more than 20 percent; budgeted expenditures for instructional support services have increased by more than 25 percent.

Over the same period of time, the student enrollment has remained virtually unchanged.

The rate of inflation has been less than 4 percent over the entire five year period (less than 1 percent per year.) It follows that paring instruction/education support expenditures to actual district needs would be an effective but also fair way to offset the indebtedness without impairing the overall educational services that must be provided.  

Certainly, no one can argue convincingly that the program offered during the 2007-08 school year was inadequate. In other words, adopting a budget for 2012-13 which is in line with that earlier budget would maintain a high quality education program but would also offset the bond-indebtedness mistake and satisfy the board's responsibilities to all concerned. I have prepared a chart to show this information.

 

School Year

Instruction budget  (000 omitted)

Support budget

Enrollment

Teacher count

Admin Count

2007-2008

$29,871

$12,886

5854

 

 

2008-2009

32,923

13,413

6011

430

24

2009-2010

36,169

13,744

5,981

 

 

2010-2011

35,514

14,412

5,914

 

 

2011-2012

35.875

16,130

5,877

423

28

INCREASE/DECREASE

20.1%

25.2%

23

-7

4

CPI change 2007- 2011

3.8% less healthcare

 

 

 

Sandra Ellis
Geneva 

G.Ryan June 25, 2012 at 09:23 PM
Thanks Sandy for your readiness implementation plan. The Board and the District need to make this a priority as there are no funds available. If we continue to ignore this issue it will only worsen. If the community can attend the public forums on the old buildings here in Geneva and attend the festivals here in town. Why can't we all attend these School Board meetings or come together to solve this financial crisis of 321 million DEBT that will not go away and will be impacting all of us in the near future?.
Political PR Machine June 26, 2012 at 01:02 AM
It seems that we should get on the early part of the bandwagon that every municipality will jump on within the next 12 months, to get Treasury Refinancing ... the Federal Reserve is already manipulating rates to assist some of the biggest Wall Street firms and insurance companies that bought and sold ficticious credit default swaps that took down Iceland, and then swept across the globe like a wildfire, wreaking havoc on global sovereign funds... perhaps saving the municipalities is the next step, and I suggest our city develop a political plan to be in front of the line and start lobbying for a refinance program. If we can save Wall Street, we should be able to save our schools.
Political PR Machine June 26, 2012 at 01:05 AM
And if taxpayers provide guarantees to JP MOrgan Chase, as we did, in order to allow them to acquire Bear Stearns in a non-competitive forced sales based on tax payer guarantees (which then allowed them to gamble with high risk bets that lost $2-$5 billion, as recently announced), then surely our tax payers can refinance the bad "mortgage" on our education system. Helping refinance Education has to be as important as helping to bail out General Motors and bailing out reckless banks. Just my opinion - it is time to play all of the cards and negotiate hard.
Thomas June 26, 2012 at 02:08 AM
Great Idea Ken! I think the next step is we need to create a Washington Lobbying firm that can convince our elected representatives that helping retired homeowners on fixed incomes is as important as giving $10 Billion in taxpayer money to a Goldman Sachs. I think we can get it done for as little as $50-100 million. Maybe Henry Paulson can help us out. He knows what it takes. He should have some free time now that he is a Senior Fellow at the University of Chicago's School of Public Policy.
Rick Anderson June 26, 2012 at 03:22 AM
Here we go. Find a Wall Street firm to repackage our bond debt and mix it in to a obscure portfolio with other bond debt from thousands of other school districts and municipalities; and sell it to Chinese investors and hedge our bets that it will fail. We can't lose!
Dwight Swartwood June 26, 2012 at 03:57 AM
We need to get a grip. Sandra's suggestion is on target. What Wall Street did and what the banks did does not give the Geneva School District Board license to run up excesses. Our taxes are breaking our backs are destroying our town, not improving it. Citizens have an obligation to provide an excellent education to our school children. We do not have an obligation to provide the largest and best buildings. We do not have an obligation to provide an oversized administration. We do not have an obligation to provide new busses every 2 years. And we do not have an obligation to provide every amenity known to mankind. We should provide only what we can afford.
G.Ryan June 26, 2012 at 04:29 AM
Great points Mr. Smartwood...I invite you to please attend the School Board meetings. I wonder if there is someone within the community who is an expert in financial planning and/or bond disbursements who would come forward with their expertise and offer their recommendations on the issue.
Political PR Machine June 29, 2012 at 12:18 PM
Please take note of the largest bankruptcy filing of a municipality in California today. After taking note, review balance sheets, income statements and forecasts for revenues and expenses around here, and let's make sure that if we have any debts that are high interest rates, we hold the Treasury accountable to refinance our debts to the same level that they helped to refinance Chase , Goldman, Morgan, and all of the others who made bets using fairy dust and credit default swaps with witch's potion and leverage in hopes of increasing the value of their stock options. As for packaging it and selling it to the Chinese.... if they don't open their borders for fair trade, I am all for it!
Geneva resident July 03, 2012 at 01:28 AM
Mr. Swartwood: we should not provide only what can afford, we should provide more. Geneva School District has a reputation of excellence. That is why I moved to Geneva. For the schools. And I knew I was paying more for a house and would pay higher taxes. The administration is far from oversized. We do not have every amenity. Get your facts straight. If the schooling isn't a priority for you, then it is time for you to move and quit complaining.
John Doe July 05, 2012 at 08:01 PM
My family and I also moved to Geneva for the great schools and all that goes along with that. We paid more for our house and had fewer choices than we would have in other towns and we accepted higher taxes. Of course there is always opportunity for improvement but it would be nice if the naysayers would also acknowledge the good things that the school district brings to the community.
Angela Kane July 05, 2012 at 08:37 PM
Dwight--excellent points. I think you nailed it when you listed the things we DO NOT have an obligation to provide. We have nice buildings and new buses--they probably makes us feel good about ourselves. We all know how important it is to feel good--self esteem raises test scores, DOESN'T IT???? GHS ranks 30th in 11th grade reading and math scores. The US ranks 28th internationally in Math scores. See what all those great buildings have gotten us? And the US lost it's AAA credit rating--BECAUSE WE SPEND TOO MUCH MONEY (and probably a lot on all that STUFF that our great leaders think MAKES US FEEL GOOD). Folks, we need good stuff (not to sound like a tea commercial) but we don't need the absolute best--because it's not making us smarter, more productive or putting us in a good financial situation. We're "feeling good" ourselves into unmanageable debt. If you don't need the new car DON'T GET IT. Don't buy a house you can't afford. Don't use a credit card you can't pay off. Good advice to live by. Unfortunately we didn't do the smart thing--we did the "makes us feel good thing" and we're gonna pay for it BIG TIME.
Angela Kane July 05, 2012 at 08:47 PM
John Doe (reveal yourself please).... I count myself as a proud naysayer, and yes, there is much room for improvement. Folks, naysayers are providing a valuable service--we're sounding the warning. We love it here and are doing our best to make sure we're not Stockton, California.
G.Ryan July 05, 2012 at 09:09 PM
Then John Doe you can pay my tax bill in September. Geneva has a bad reputation for their high taxes and just because it is attractive to you does not mean you are considered the norm. There are more people who will steer clear of Geneva because of the 321 MILLION DEBT issue.
John R July 05, 2012 at 10:09 PM
@ Gayle you keep mentioning your property tax bill. You need to come clean regarding your situation if your going to use yourself as an example. I believe you live in a 3/4 million dollar home and your taxes went down substantially. If that's the case your going to have high property taxes. It's all based on your assessed value. We might not be able to get your taxes low enough for you based on the caliber of your home. @ Angela nobody is required to provide there full names on the Patch. Only a handful of the taxfacts folks give there full names. Heck even G. who post all the time on various topics only gives her first initial. Personally I don't think it's a very good idea for anyone to use there full name. It's an individual choice. Rice
G.Ryan July 05, 2012 at 10:46 PM
John R...come "clean" on what? Your comment suggests I am hiding something. The taxes here in Geneva are high in comparison to other surrounding communities due in part to the reckless spending of this District and Board. Furthermore, my taxes did not go down substantially so you are wrong on that. And your statement of " we might not be able to get your taxes low enough for you based on the caliber of your home." Who is "we"? Every year I have resided here the taxes have increased substantially and it is the money supported to the School District. Whether where I live and the caliber of the home is irrevelant to the principle of the spending issue here John. The principle of the issue is the spending and the DEBT. And I feel I have paid more than my fair share on this spending addiction.
Angela Kane July 05, 2012 at 10:50 PM
Why should anyone here be afraid to use their real name unless they are a school board member or alderman or other elected official posting? Retribution? This is a free country. Yesterday was Independence Day. People died for the freedom to express ourselves. Everyone is entitled to an opinion. The Patch is a wonderful opportunity to have a dialog in the public and to discuss issues that are of interest to us all. It's invigorating, sometimes annoying, and often intriguing. Express yourself folks. If you care about these issues have the courage to be real. None of is always right or always wrong. I think we learn something every time we read something we agree with OR disagree with. I respect those people who reveal themselves, and honestly, have pity for those people who hide behind some fake name.
Thomas July 05, 2012 at 11:17 PM
G. Ryan, you claim "The taxes here in Geneva are high in comparison to other surrounding communities..." but if you refer to a previous patch article the FACTS tell a different story. http://geneva.patch.com/articles/coming-to-a-mailbox-near-you-your-property-tax-biil-745f3f8c. Now I am sure you will claim that won't be the case in the future, and you may be correct. Time will tell. But as for the present, 9 surrounding communities have higher property taxes than Geneva
G.Ryan July 05, 2012 at 11:36 PM
Thomas, 321 million of DEBT is not healthy for any community. I have friends who reside in St. Charles with the same caliber of housing who pay less by thousands of dollars. So something is definitely wrong here with the system. My realtor has mentioned Geneva has a reputation for higher taxes and she has been a realtor for over 20 years approximately in the Fox Valley area. My point is we have a real spending problem here with this Board and District. People need to get involved so we can get this resolved and under control. Taxes will be increasing to pay off this bond and we are all strapped to the max now. What do you suggest Thomas to resolve this issue? I can say this, I attend the meetings and I am getting involved.
Political PR Machine July 05, 2012 at 11:38 PM
It is time to have high level discussions with the treasury to make sure that they offer us the same rates that they offeref banks, and if our rate is tied to Libor in any manner then send the bill to Barclays and the banks that have admitted to manipulating that rate.
Thomas July 06, 2012 at 12:32 AM
G. Ryan, I find it somewhat ironic that many posters who take such issue with a former school board using inflated numbers to get a referendum passed don't have any problems using statements that are clearly based more on emotion than actual facts in order to get people to come to their way of thinking. Do we have any actual statistics of people who have left Geneva because of "eviction by taxation"? Because you have a friend in St. Charles who pays less in taxes than you, you can definitively say Geneva's property taxes are one of the highest in the area? You mentioned how people are steering clear of Geneva but I am seeing more and more stories on the Patch of homes being sold in Geneva. I am sorry G. but just saying something exists doesn't make it true. The statistics say otherwise. I understand you want more like minded people attending school board meetings angry as hell and not wanting to take it anymore but you would be much more credible in your arguments if you used facts and logic instead of the beating the same drum about "Board of Spenders" and "spending addictions" I have lived in Geneva for over 25 years and have yet to talk to anyone who feels the town of Geneva is being "destroyed by taxation". Now I am sure there are people out there that may feel that way, yourself included, but I am confident there are just as many people out there who don't think like you G., myself included.
Mitotero July 06, 2012 at 02:48 AM
Thomas, great post. There are at least 2 of us who do not think like G. Now get ready to duck, there should be some incoming rounds.
John R July 07, 2012 at 03:21 PM
Mitotero and Tom there are three of us. I sure hope McQ doesn't read this or he's gonna be all over me. G. Come April 13th TaxFacts will more than likely get control of this School Board. It's easy to take over a school board and the tactics used here and at the meetings are working. Do you plan on running? I used WE in my post because I am a member of this community who's taxes help support Dist 304. Which I might add I'm happy to be contributing too. We (the community of Geneva) might not get your property taxes low enough. Regarding your taxes you have tossed yourself into the ring on a number of occasions. I really do feel bad for you because from some of your previous post it does seem like you are struggling to pay your property taxes. But then on the other hand your the one that has choosen to live in a custom home and unfortuently you purchased it at the height of the real estate bubble. It does appear that they must have reassessed your property because your taxes went down by a few hundred dollars. Mine actually went up by $400 dollars but to be fair not all of that increase went to Dist 304. Here's a suggestion. Sell you McMansion and buy a house in my neighborhood. There are three houses for sale ranging from $220 K - 300 K. The property tax burden is about $12,000 less than what your paying. Now before you get on your high horse about this being none of my buisness keep in mind that you've put it out there. J.R.
Robert July 07, 2012 at 04:02 PM
Make that four. I too am with Mitotero, Tom, and John R.. I made a conscious decision to move my family here 5 years ago and commute 60 minutes to my work. I did this because my family and I fell in the love with Geneva from previous visits, and after checking out the schools, we made the decision to move here. The taxes are higher than where we lived but we decided the school quality was worth it. So I made the choice to pay the higher taxes and also put in the time and expense to commute to work. It was a conscious decision. I guess if the school's quality declines in the future I may have to make the decision to move elsewhere. Just as I chose to move the Geneva, certainly folks can choose to move away if they find the taxes are too high. As long as the schools are good I am pretty sure others who place a value on education for their kids will move in. Just like some folks don't mind spending a lot for an Ivy League college education for their kids and drive a clunker car as a sacrifice, others would rather spend their money on a fancy car and have their kid go to community college. It's all just priorities and there isn't a right or wrong answer...it is just what feels good in your gut at the end of the day.
Robert July 07, 2012 at 04:06 PM
Oh and no I am not going to provide my entire name. Frankly from what I have observed, the Geneva TAX FACTS folks kinda scare me a bit. Really don't want them knowing my full name. Call me paranoid but the internet is powerful and sometimes it is wise to remain anonymous.

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