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Sunday, April 15, 2007

The real cost of school construction



In Nevada school operating costs (salaries, heat, electricity) are paid to school districts by the state under a complicated tax redistribution plan designed to assure that each county school district receives the same amount of money per pupil.

This is intended to assure there are no rich or poor school districts. Although not perfect, the system goes a long way to avoid problems of unequal school districts that Arizona and California have.

School construction is another story.

Those costs are paid almost exclusively by county school bonds the interest and principal of which are paid by local property taxpayers.

That's us, folks!

Until recently school districts had to get county voter approval to issue bonds but that changed a few years ago when voters gave a blanket approval to new bond issuances provided they would be floated without increasing property taxes. That worked for a while because increases in county assessed values provided a wider base over which to spread bond repayment requirements. Then in 2005 the legislature enacted a 3 percent per year cap on residential property tax increases and school officials have been gnashing their teeth ever since.

Maintenance and replacement reserves are a problem.

They should really come out of operating income but it might take years for a boiler to fail or a roof to cave in so funds need to be set aside. But when the Washoe County teacher union sees a pile of cash in the budget it's fair game for salaries so repairs and replacements have to come out of school construction funds which are increasingly harder to come by.

This year Washoe County school officials went to the legislature with a request to increase the tax on Washoe County property deeds to pay for new schools and deferred maintenance, a burden that would fall on home sellers and real estate professionals.

Not surprisingly the Builders Association and Reno Sparks Association of Realtors opposed the proposal on the very logical basis that everyone should pay for public education, not just home sellers and real estate professionals.

It died during its first senate hearing because of opposition and because of the very real argument that revenues would be unreliable from year to year because of fluctuations in the real estate market.

The Reno Gazette Journal's "Over The Fence" column recently asked: "Should lawmakers go back on their promises of no new taxes to ensure that the Washoe County School District has (adequate revenue sources)?"

Fred Lokken, a political science teacher at TMCC and, believe it or not a Republican, answered: "Yes. Promises ... regarding no new taxes should never be made until we are fully aware of need and circumstances."

L. D. Lovett, an African American professional educator (no political affiliation given) said: "No, lawmakers should not go back on their promise of no new taxes.

This could create a financial burden on many ... and it would be a breach of promise. The issue is lawmakers not only living up to their word, but also in requesting better management and accountability of the current revenue available... If educational progress and quality services are being provided then more revenue may be warranted, but that should be a decision made by the voters. Individuals with limited and/or declining incomes must prioritize spending and live within a budget. With limited resources the focus should be on accountability, growth control and quality of life vs. how to charge individuals more taxes with no assurances that this will result in better schools."

Well said, Mr. Lovett! And how about legislation requiring school districts to sequester building maintenance and repair budgets so they are not available for other purposes?

(Jim Clark is President of Republican Advocates, a vice chair of the Washoe County GOP and a member of the Nevada GOP Central Committee)






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