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District 204 weighs referendum to fund air conditioning

Pros/Cons of referendum options

Use existing revenues and fund balances

Does not require voter approval

Will reduce fund balances

May require the need for short term borrowing

General obligation building bonds

Requires voter approval

Option is paid back with property taxes

Cost could be offset with refunding existing bonds

Has been used in the past for building projects

One-time funding source

Cost to taxpayer dependent upon bond amount, refunding of existing bonds, and payment structure

Increase the limiting tax rate

Requires voter approval

Will provide added annual revenue stream

Funds would be deposited in the educational fund and/or operations and maintenance fund

Projects can be funded annually with new revenue, or debt can be issued to fund projects upfront then added revenue can pay back the debt

Added limiting tax rate will become part of the current limiting tax rate

Can be used for unlimited amount of time

Establish a debt service extension base (DSEB)

Requires voter approval

DSEB is the maximum annual amount that can be levied for principal and interest on general obligation limited tax bond

Bonds can be issued for air conditioning, life safety and other capital projects

Once DSEB is established it increases by CPI

Most Illinois school districts already have a DSEB

Create County School Facility Occupation Tax law (sales tax)

County sale tax of up to 1 percent can be established by a simple majority of voters

Question can be placed on the ballot when school district in the county representing 50 percent of students have approved a resolution

Requires multiple districts to seek the referendum and coordination among several districts is needed

All the districts in the county benefit if passed

Revenue can only be used for capital projects

— Source: Indian Prairie School District 204

Updated: January 31, 2014 10:57AM



AURORA — On a night when the wind chill was near 40 below, Indian Prairie School District 204 this week was trying to figure out how it was going to pay to cool 20 schools that have no air conditioning.

The irony was not lost on School Board members.

On top of the air conditioning issue, District 204 is weighing the possibility of major maintenance work on many schools that have been around since the enrollment boom of the 1980s.

With so much facility work on the plate, School Board members are considering what type of referendum would be best to fund the projects.

The air conditioning issue came to a head in the fall when temperatures soared over 90 and caused the closure of District 204 schools with no air conditioning. After an outcry from families and teachers, the School Board appointed a heat committee to study the costs and time to implement various ways to cool the schools. The committee looked at everything from whole-school air conditioning systems to renting window units.

Todd DePaul, director of building operations, said the group recommended installing a ductless variable refrigerant system that would bring cooling units into each of the 650 classroom as well as the library media centers. The plan, which could be completed in a summer, would cost the district $13.6 million.

Whole school cooling systems were discounted by the committee because of the estimated $38 million price tag, and window units were dismissed because of the noise, installation issues and potential for causing cold to leak into classrooms during the winter.

The board seemed to support a referendum in some form to pay for the cost of installing air conditioning, but fixing that issue might not be enough. A report from DePaul outlining the facility needs throughout the district is expected in April.

Assistant Superintendent of Business Jay Strang outlined five basic funding options which could be used on their own or combined to fund the school district’s needs. Options include tapping existing fund balances, issuing general obligation bonds, increasing the limiting tax rate, establishing a debt service extension base, and creating a county school facility occupation tax (a sales tax).

The board immediately discounted the facility occupation tax as too difficult, particularly since Indian Prairie lies in both DuPage and Will counties and getting so many school districts to join the effort might take too much time and energy.

School board member Mark Rising said he was not comfortable using fund balances. He was willing to look at restructuring existing debt in addition to a referendum option.

Rising added that if the district pursues a referendum, he would want to include other maintenance projects around the district.

School board member Maria Curry raised concerns that the referendum process could take time and parents might not be patient.

“Do you think voters will understand?” she asked.

Board member Michael Raczak said as long as the board shows that it is acting in good faith, the public should be responsive.

“Spending $13.6 million out of the fund balance, which we really don’t have, it’s going to puts this community and this district in a spot for the future that might be untenable,” he said.

“This is a tough topic and a tough decision. I understand the community wants immediacy,” Raczak said. “On the other hand, short-term immediacy for the long-term future of this district and our kids, we have to weigh that very carefully. I guess as a board we are going to have to communicate that to our public, that we are trying to balance all this.”

Board member Cathy Piehl said residents of the district should be accustomed to waiting.

“Every time we built a school, the kids had to wait,” she said. “Waubonsie was overflowing. Neuqua was overflowing. The kids were eating lunch in the hallways.”

The earliest District 204 could get a referendum on the ballot would be in the Nov. 4 general election. But with a new superintendent starting and the families out of touch with school during the summer, School Board President Lori Price said the April 7, 2015, election might be a better idea, since it would give the district more time to prepare.

The board decided to wait for the facilities study and a report on the district’s existing debt before deciding which direction to pursue.



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