Kyrene board votes no on tax increase to offset losses
After considering vocal opposition at a packed, four-hour hearing, the Kyrene School District Governing Board voted no on a proposed one-year property-tax increase, deciding to try other approaches to solve a newly discovered budget shortfall.
The board was due to reconvene later in the week to discuss rearranging bonds as a temporary fix for the debt.
“I’m glad we have decided on a compromise that can edge us out of our considerable debt without costing the taxpayers any money,” said school board president Michelle Hirsch.
The session was originally called to vote on a motion to increase taxes by 64 cents per $1,000 in assessed home valuation. That approach stirred public reaction and resulted in several dozen residents showing up to protest.
In 2010, voters approved a sale of bonds to maintain district facilities—approximately $11.6 million per year over a 10-year period. However, the housing-market crash and large drops in assessed valuation in the past few years meant that Kyrene was left unable to sell those bonds.
Earlier this year, state legislators indicated relief was likely in sight, telling Kyrene there was little opposition to House Bill 2405, a measure that would have allowed the sale of the bonds. After being approved by the House, Senate and Gov. Brewer, however, the bill was held by Senate President Russell Pierce for the final two months of the legislative session and left to die.
The tax increase would have funded roofing, skylights, plumbing and electrical improvements at Kyrene’s 26 facilities. It would have also cleared some of the district’s debt, as well as increased savings on bond interest costs.
Although these are all problems that eventually need to be addressed, the school board questioned whether it was the right time to impose another tax increase.
“The roof might need to be replaced at my house, but if I’m short on money, I might wait until I have some before I think about replacing it,” said board vice president Beth Brizel.
The board maintained that it is responsible for ensuring the health and safety of the district’s students, at the same time keeping the trust of the taxpaying public. Many board members questioned whether the tax would be the right solution.
This sentiment was echoed through community members who volunteered to speak.
“We are all here for the kids, but we also have bills to pay, and an economy that’s in the toilet,” said Kyrene resident and former state legislator Laura Knaperek. “There has to be a way to balance all of these things.”
Board member Ross Robb suggested using a portion of the district’s reserve money, in lieu of the tax, to address the most urgent facility improvements.
“We need to get over our conservative view toward the reserve money; it’s there for situations like this,” he said.
The board eventually decided against the tax increase in favor of bond restructuring. Financial lawyers were asked to prepare a plan to be reviewed at a session scheduled for June 14.
If all goes according to plan, rearranging the bonds will be a quick fix for the district’s debt issues, and will hold it over before trying to pass a bill similar to HB 2405 in the 2013 legislative session.
“We need to look at the overall picture, prioritize our priorities, and find a way to address our debt without revisiting our [ghosts],” said Superintendent Dr. David Schauer.
For more information on Kyrene’s bond restructuring and the proposed increase, visit http://www.kyrene.org/.