Education, Jefferson County, Sherrie Peif, TABOR, Taxes, Uncategorized

Jeffco school board builds new school without adding debt to taxpayers

Note: This is the sixth in Complete Colorado reporter Sherrie Peif’s series of “Know before you go” stories, breaking down the arguments presented by a group of Jefferson County residents seeking to recall three members of the Jefferson County Public Schools Board of Education. In this story, we report on how the majority members pushed to build a new school in Jeffco without new debt or creating debt without voter approval. Read the previous reports here: part one, part two, part three, part four and part five.

There is no question all five members of the Jefferson County Public Schools Board of Education know the district faces a population crisis. They have all agreed at several past meetings to the fact that there will be a need for thousands more student desks, just within the next five years.

What they don’t agree on is how to pay for the four to five schools and multiple school expansions that are needed to support the rapid growth projected to cost nearly $500 million at full buildout.

File photo - Todd Shepherd
File photo – Todd Shepherd

The discussion came up again at the Sept. 3 business meeting in regards to a new school that will be built in the Candelas area, northeast of the intersection of Colorado highways 72 and 93, west of Standley Lake.

The original proposal brought to the school board on Sept. 3 was to build a kindergarten through sixth-grade near Table Rock Mesa, an area about eight-nine miles south of Candelas, but board members wanted the school closer to the high growth area. The board spent more than 90 minutes debating which of the two sites—as well as a third site, Leyden Rock, a mile south of Candelas—would give them the most seats for $18 million in funds they had previously budgeted.

Additionally, many members of the public spoke against the Table Rock site, something board member John Newkirk said he heard loud and clear.

“Each one of us was elected by the people of this district to represent their interests in Jeffco Public Schools, which means pretty much by definition that we were specifically not elected to rubber stamp everything brought to us by the district,” Newkirk said. “And every one of us … at one time or another has not taken staff recommendations if we feel those recommendations are not in the best interest of our constituents or the district as a whole.”

In the end, the board chose the Candelas site, but not until also debating the pros and cons of a K-6 versus a K-8 and Certificates of Participation (COP). The decision on whether or not to build a K-6 or K-8 will be made at the next meeting on Sept. 24.

The school will be paid for with $18 million in existing funds to take some of the pressure off until they determine the next steps to meet the district’s needs. But a discussion on the use of COPs to speed up the construction process came up again, and drew the most tension.

The three majority members who are subject to a recall vote in November — President Ken Witt, Julie Williams, and Newkirk — have said repeatedly they will not agree to the issuance of a COP no matter how small.

A COP is a financing tool that skirts the intention of the voter-passed Taxpayers Bill of Rights (TABOR), which requires all new taxes to be approved by the voters.

It allows a third party, usually a dummy corporation created by the government itself, to use the new construction as collateral on bond debt that is repaid by “leasing” the property back to the government.

However, also because of TABOR, the lease cannot last for more than one year, instead coming up for annual renewal until the bonds are paid off. Essentially, the board could vote against renewal, which could force the district into years of legal battles trying to determine who owns the building and who’s responsible for the debt.

More importantly, because COPs are issued without voter approval, the money to lease the buildings comes out of existing general funds, leaving less resources for such things as teacher compensation and new programs.

File photo - Sherrie Peif
File photo – Sherrie Peif

“That’s not the way I want to operate,” President Ken Witt said. “If voters want to approve debt, take it to them in a well-fashioned argument.”

Members Jill Fellman and Lesley Dahlkemper, both of whom have decided not to run for re-election, want the district to create a non-voter approved, $80 million debt using COPs, which would cost about $4.5 million a year in lease payments.

The two women also proposed issuing COPs earlier this year. In February, Fellman and Dahlkemper supported issuing an $80 million COP to spend on a new stadium in south Jeffco and a school on the west side of Lakewood, neither of which would solve the current growth problems.

At the Sept. 3 meeting Fellman, with Dahlkemper’s support, suggested the $80 million be reconfigured to build three new schools in the high growth areas and finish a fourth one: Sierra Elementary.

Though Fellman said in a previous meeting that she will not borrow money, a COP has the same effect as either a loan or a bond. It creates new debt. The only difference is it is paid for using per-pupil funding and other revenue that makes up the general fund.

When the idea was rejected again, both women repeated their displeasure with spending $18 million of current money on a new school.

“The only ones we have to blame for being in this position are the five board members sitting around this table right now,” Dahlkemper said, while calling the $18 million expenditure fiscally irresponsible.

“We have ignored the advice of the superintendent, of the (chief financial officer), of the facilities director, of the financial oversight committee, of the capital asset committee. All of whom said to us, ‘issue COPs.’ Do not take money out of your operating budget which can pay for things like smaller class sizes, money that can go back into the classroom, compensation that is competitive with other school districts,” she added.

Witt reminded Dahlkemper that the money can’t be spent on compensation because it’s one-time money, not ongoing revenue.

Steve Bell, the district’s chief operation’s officer, told the board a COP for a short-term relief was the best avenue to take. He said the board then could go to voters with a bond issue in the future to pay it off, despite knowing that a bond issue is not guaranteed.

Newkirk has frequently referred to that idea as borrowing money that puts the district in debt first and then asks the voters to forgive the board and pay off its mistake.

Dahlkemper was willing to ignore her concerns after Fellman offered a compromise that would issue $62 million in COPs, using the $18 million to make up the remaining portion of the $80 million.

That proposal also failed.

Witt and Newkirk said they would support exploring the idea of a bond issue in 2016 to let voters decide.

“Until then, let’s operate within our means,” Witt said. “We will have the means next year to build another one, one that does not undertake debt that the voters have not approved.”

“I am very open to going to the people to ask for that,” Newkirk added. “I am very keen to work with you for something like that in the fall.”

Williams said she wouldn’t vote in favor of a COP no matter what.

“I am not bringing forward a mortgage or a loan or whatever you want to call it without a vote of the people,” she said. “If we want to build a campus and (67 million worth of schools), that needs to go to a vote of the people.”


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