Harleton ISD May 7, 2016 Bond Proposal FAQs
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1 Harleton May 7, 2016 Bond Proposal FAQs How was the total projected cost of the project developed? The cost of the project was based upon data concerning average costs of school construction found on the Texas Comptroller s website and the standards for square footage per student found on the Texas Education Agency s website. By applying this amount to the number of students currently housed in the campuses and adding an additional 20% for future enrollment growth, the district was able to determine an amount that would be a reasonable estimate of cost for the project. Based on number of students, square footage standards, and average cost of construction, we can gain an estimate of the cost for the building. Then we have to factor in dirt work and site preparation, building roadways and parking lots, site utilities, and furniture. Total Number of Students: 1. Elementary= 438 (365 current) 2. Junior High= 216 students (180 current) 3. Total number of students= 654 *These numbers take into account the 20% enrollment growth New Building Size=82,566 square feet heated Note: The actual design calculation was 117 square feet per each elementary student plus 145 square feet per each junior high student. Cost per Square Foot=$ (Average school construction cost) 82,566 X = $12,430,398 (Buildings proper) Total Project Costs: Buildings Proper= $12,430,398 Dirtwork, Utilities & Demolition = $ 511,395 Driveways & Roads= $ 379,040 Parking Lots= $ 581,950 Furniture= $ 314,707 Total Project Cost= $14,217,490 The district has proposed a bond issue of $11.75 million. The remainder of the project will be paid with reserve funds. How does this cost compare with surrounding districts? According to the Texas State Comptroller s website for School Construction Costs, the following information is correct and last updated on July 30, The information below provides data on the costs of school construction for East Texas schools between :
2 District Campus Square Feet Student Capacity Adjusted Construction cost Adjusted Cost per Square Ft. Henderson Henderson Longview Wylie Primary 61, $13,696,596 $222 Wylie Elementary 61, $13,696,596 $222 JL Everhart Elementary 87, $18,543,632 $211 Overton Overton HS 19, $3,971,865 $202 Kilgore Kilgore MS 112, $22,441,640 $199 Hallsville Hallsville HS 373, $73,150,416 $196 Longview Hallsville Kilgore Spring Hill Forest Park MS 149, $28,540,704 $191 North Elementary 94, $16,528,763 $175 Kilgore Primary 160, $27,568,258 $172 Spring Hill HS 164, $27,017,306 $165 Ore City Ore City EL 68, $10,375,778 $151 New Diana Robert F. Hunt EL 46, $6,966,251 $149 According to the Comptroller s site, the methodology that was used to collect these cost figures was based on the following, Our agency requested information for all newly built campuses that opened between Jan. 1, 2007 and October Because we wanted to measure only the facility costs of campuses built from the ground up, we asked responders to exclude land, road and parking costs and itemize them separately where possible. Please note that these costs do not reflect any inflation or rise in construction costs and only show the actual costs at the time of construction.
3 What are we getting for our money? The Bond proposal calls for the construction of two new buildings, a new elementary (including primary) building and junior high school building. There will also be some shared facilities that will be constructed. These include: Cafetorium, Gymnasium, parking lots, and media center/library. There will also be opportunities for cost savings by sharing electrical and mechanical systems. The costs also include reworking Stadium Drive and creating new driveways and parking lots that can be utilized for other activities, such as parking for the football stadium. Demolition of the standing facilities is also included. Why doesn t the district have the finalized plans for construction? No school district, that we have found, has completely finalized construction documents and blueprints before the passage of a bond. The costs would be too great to get the soil testing, civil engineering reports, topography reports, architectural costs, etc., before even knowing if the bond will pass. Also, the costs for these plans, before the passage of a bond would have to come out of the Maintenance and Operations side of the finance budget for the district, and these costs have not been budgeted. The normal process for bond proposals is being utilized by the district. The district, based upon recommendation of the Steering Committee, is planning to build two new school campuses (elementary and jr. high) with shared facilities when possible (i.e., gymnasium, cafetorium, media center/library). This is a conceptual phase just like the other school districts have presented for bond proposals. Please see the section How will the district finalize the building plans? To find out how the district will finalize plans if the bond is approved. What will be the increase in the tax rate? The maximum tax rate increase would be $.31 per $100 of valuation. That translates into $310/year, $25/month on a home valued at $100,000. Currently, our district has had a tax rate of $1.25 per $100 of valuation. This includes $1.17 for Maintenance & Operations and $.08 for Interest & Sinking(debt). This rate has been the same since when it was lowered from $1.255 per $100 of valuation. Harleton has chosen to give its property owners an additional 20% Optional Homestead Exemption. That means that the district receives no tax revenues for 20% of its appraised values. Taxpayers will continue to receive this 20% exemption. The proposed bond will increase the tax rate by 24.75%, but the local optional homestead exemption of 20% will still be in place. In addition, the 84th Legislature increased the state s homestead exemption last year from $15,000 to $25,000.
4 Please note, if you are 65 or older, your tax rate is frozen and will not be raised even if the bond passes. Why don t we just remodel? Renovation of the existing buildings was a consideration. The estimated cost of renovation was $11,229,447. This amount would be 79% of the cost of new construction. Also, of considerable note is to determine what would be done with students during the renovation process? Why are we doing all this at one time instead of in phases? Construction costs continue to rise at a rate of 4 5% per year. On a project valued at $14,217,490 that would be an increase of $568,700 per year that we wait. In addition, interest rates are on the rise nationally. As these rates rise, the cost associated with the bonds will rise, as well, costing the taxpayer more. In turn, the longer we wait, the more it will cost the taxpayer. What will happen to the existing buildings? The district is accessing areas that could be repurposed for other uses (i.e., storage, bus barn/maintenance facilities, etc.) The remaining structures would be demolished to make room for future expansion. What about all of those transfer students in the district, and how are they going to share the cost of new buildings? Currently, there are 58 transfer students in the district. Sixteen (16) of those are children of employees. The district encourages employees to bring their children to the school. If you take the employee children out of the count, the district only has a 5% transfer population. On April 12, 2016, the Board of Trustees raised the Transfer Fee for student transfers to $800 per student. This is an increase from $500 per student. The district receives the fees of each student and the state funding that comes with each additional student in the district. How will the construction process and selection be handled? According to the Texas Government Code, Chapter 2269, there are six procurement methods that can be used by a school district when handling a construction project. If the bond is passed, the Board of Trustees will determine the best value method for the district. Once that is determined, the Board will make a Request for Qualifications from construction companies. This request has to be posted for 14 days and list the selection criteria that will be used by the Board to determine the best candidate for the project. After qualifications are submitted, reviewed, and ranked according to the selection criteria set forth, then the Board will make a final determination on which company to award a contract. This process has not been done and will not be done until passage of the bond proposal. Slone Construction has been under contract with Harleton since 2012 to provide advice on construction matters; however, if the bond passes, the Board will still have to go through the statutory requirements for selection. Any construction company that is able to meet the criteria
5 set forth by the district will be able to submit their qualifications. Also, in some of the procurement methods (i.e., Construction Manager Agent) the construction manager s company can t do the work and have to put each aspect of the project out for bid. How will the district finalize the building plans? If the bond proposal is passed, the architect will meet with all stakeholders to design the buildings according to needs. The Board will solicit input from all community stakeholders interested. Final plans will have to be approved by the Board of Trustees before construction can begin. We will need to plan to build facilities that will be in use for years. Part of the current buildings were opened in Why don t we pay off the bond on the High School and remove that tax from the tax rate? The bond for the High School building was issued in 1996 on a 30 year note. It will be paid off in Last year, the district was able to refinance these bonds at an interest rate of 3.5%, saving the district thousands in costs. Today interest rates on bonds range from %. If the district paid off the 1996 bond and borrowed the money on the total cost of the project, then it would cost the taxpayer more. How long will it take to pay off the bond? The bond note will be for a period of 30 years. In Section 10(f) of The Notice of Bond Election, a copy of which can be found on the district s website, is written with the language of the state statute and states that the district can issue bonds,...in one or more series, to mature serially, over a period not to exceed 40 years. The district has chosen a maturity of 30 years and has based all of the bond figures upon a 30 year maturity. When is the election, and where can I vote? The election will be held on Saturday, May 7, The polls will be open at the Harrison County Elections Office or the Harleton Community Center from 7am to 7pm. There will also be an opportunity for early voting for this election April 25 29, and May 2 3 at both locations. Times and dates are available in the Notice of Election which can be found on the district s website.
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