Part 6: BISD $81.2M Bond, Post Election Comment

Not surprisingly, the BISD $81.2 Million Capital Improvements Bond was approved.

The 23,410 Bainbridge Island residents will now have an estimated $145 million in new taxes to pay starting in 2017 and running for the following 22 years … $81.2M in principle, $64 million in estimated interest payments.

On the positive side, the two new buildings should be state of the art awesome. Can’t wait to see what Blakely Elementary that the School Board and general public approved a bond for $10M more than the cost of Wilkes will look like. It will likely be the highest cost per student elementary school ever built in Washington State … but that won’t be known until Blakely is opened and the contractor’s checklists and change orders have been resolved, and final bills have been paid. The new Bldg. 100 should be something to behold … curious to see what $2 million in theater lighting and electronics (above the $2 million a year in tech levy money) brings to the new 600 seat theater stage. Another big smile and wow experience I suspect.

On the negative side, Bainbridge Island has just become less affordable. This capital bond will cost the average residential property owner between $10,000 and $12,300, and the BISD has an even larger bond planned for a 2019 vote ($102.3M is the preliminary bond estimate). This capital bond approval averages about $500 of new taxes a year for the average residential property, but that adds up year after year, especially to the 39% that the director of the Housing Resources Board says live on Bainbridge Island  but don’t have the income to qualify for a single family house on the Island.

As a side thought, this school bond approval (i.e., increasingly higher property taxes) could be a strong talking point for one of the affordable housing options for the Suzuki parcel.

How does a bond this cost bloated get a 62% approval?

•  BISD is the largest employer on the island.  Most school employees vote and support the bond.
• Full page ads with a long list of who’s who of community leaders names listed as bond supporters.
• An aggressive “letters to the editor” campaign.
• Financial support from local businesses that may benefit from construction.
• The “It’s for the Children” standard educational statement.
• Vote “YES” signage.
• Street corner “YES” sign shakers and holders.
•  Not a single sharp pencil (meaning an auditor or accountant) on the School Board that approved the bond amount and the payback schedule.
• No Washington State “truth in advertising” law(s) that require school districts provide full and accurate financial disclosures or accurate cost comparisons to the general public for a school bond that the public will be required to pay.
•  A BISD financial group is hand picked by the BISD … it’s more of a support the BISD  group than a financial knowledgeable body that performs value engineering and cost reasonableness tests. (I’m basing that on the the Wilkes Elementary financial board … this $81.2M bond appears to have similar type school district financial oversight).

High quality  schools are a priority in wealthy communities, as they should be. But a new and best school scenario also drive up housing prices because families with school age children are willing to pay a premium housing price to be located in a highly rated school district. As Bainbridge residential assessment values increase, the school taxes also rise, but so do annual taxes to both the state and Kitsap county because the relative assessed parcel values increase faster than the rest of Kitsap County. So for taxpayers, it’s a triple tax whammy.

I look at the long list of names of Bainbridge Island community leaders published by the Bainbridge Review of “Our Schools Our Future” supporters and wonder if any of them actually took the time or made any effort to consider due diligence to the cost and tax implications of the bond. I suspect the answer is no.

That’s a long list of elected and community leaders I would not want as my financial advisor(s).

The only organized group that considered the bond details and tax implications was the Editorial Board of the Kitsap Sun … they rarely (if ever) conclude a school bond is not worthy of a yes vote, but this one was just too bloated and the tax implications too onerous … they concluded it should be rejected and resubmitted at a more realistic bond amount. Well done, Kitsap Editorial Board for your financial due diligence … something the who’s who of community supporters failed to do.

So what now besides paying the new taxes and admiring the new buildings when they are constructed?

So what might the School District now do to show that they are using the taxpayers money for this bond wisely and for the purposes for which they stated in the bond literature?

Here is one suggestion submitted by a reader who has past experience with a California school district where the general public was wary of how the school district was spending their capital bond money:

Put in place a capital projects citizens oversight committee (not school district employees) to monitor and report what was being done and what was being spent. They would not interfere with BISD capital projects staff … the committee would have only an observe, report and comment function. The independent citizen’s report could be a quarterly report that perhaps might be even published in the Bainbridge Review.

Like that idea.