Decatur Commissioners weigh in on bond request that would raise city taxes
Decatur’s School board will meet tonight at 6:30 pm to discuss the details of a request for a referendum on issuing more debt to pay for school construction.
The debt, in the form of a bond issue, could increase taxes for residents by hundreds of dollars each year. It’s a dicey moment for the school system that’s swelling with students and running out of room for them. Current City Schools of Decatur enrollment is 4,300 students. CSD consultants project it will be more than 6,000 by 2020.
But the City Commission, which has to approve any referendum, will have to consider what increasing Decatur’s debt would mean for the city’s future.
After a meeting on Feb. 17, three commissioners said that, for the moment, the ball is largely in the School Board’s court.
“You’ve got to trust them to come up with a plan,” Commissioner Scott Drake said. “They know it. I trust them to come up with a plan and see what they feel comfortable approaching. They’ve got to feel comfortable with the ask.”
School Board members looked a little uncomfortable during a meeting on Feb. 10 where they voted to seek an $82 million bond referendum. A bond issue would have to be approved by the voters. Taxpayers would have willingly increase their own millage rate by 4.84 mills if the city borrows $82 million for its schools. For a $300,000 home, that’s $726.51 in additional taxes per year, starting in 2017. For a $700,000 home, that’s an additional $1,695 in taxes.
Drake said that, ultimately, it’s not the commission that should concern School Board members.
“We’re one stop, or one hurdle,” he said. “I think they need to be a little bit more worried about the community than us. The community is made up of a lot more people than just parents with kids in the school system. We’ve got a range of different people here, different ages, different backgrounds, different thoughts on the idea, so they need to do their due diligence and figure out what the community is going to support.”
But it will inevitably be the commission’s concern. The city and school system are joined at the hip when it comes to debt. The city has taken on $172.2 million in debt since 2005 for various projects, including school expansion. There’s a constitutional debt limit, however, 10 percent of the assessed value of the city’s current tax digest, according to Dianne McNabb with Public Financial Management, an advisor for CSD. That $82 million request would be very close to the city’s limit, which would affect its ability to borrow in the future to pay for more projects.
Does Drake have any concerns about the city’s debt?
“I haven’t been instructed,” Drake said, trailing off a bit. “I know that they combine our debts. I haven’t seen anything or heard anything that’s …”
Commissioner Patti Garrett cut in.
“We have financial advisers that are going to keep us where we need to be, and I think that’s a part of the process,” she said. “But I think the primary issue with all of this is it’s the schools’ decision to make a recommendation to us, and that’s what we’re looking to them for, to make that recommendation, based on what they think they have to have and what they think the voters will support as well.”
Commissioner Kecia Cunningham said it’s “too early” for her to say whether she’ll support the School Board’s $82 million bond request.
“Ultimately it’s up to the voters,” she said.
She said the debt limit is something commissions will have to keep in mind.
“I think, to be good stewards and fiduciaries, we have to look at that and pay attention to what any addition to debt does for our bond rating, and our cash reserves and the tax burden as well,” Cunningham said.
Tonight’s School Board meeting will be held at 125 Electric Avenue, Decatur, GA 30030. All School Board meetings are open to the public.