Leader Blues

Wednesday, April 15, 2009

TOP STORY >> Bond issue will exempt proposed new district

Leader staff writers

Although the Arkansas Department of Education denied a request by the Pulaski County Special School District to issue bonds for two new schools, the school board voted Tuesday not to saddle north Pulaski County with the debt if a new district is formed.

The board voted 5-2 on a motion brought by Bill Vasquez to exclude a new Jacksonville district from the debt.

Earlier, acting Superintendent Robert McGill vowed that the new school district would not be saddled with any of the debt that would come with the new bond issue.

“The (school) board is adamant that debt should be paid for by Pulaski County Special School District – not Jacksonville,” McGill told the state Education Board before it turned down the bond request on Monday. “Once it detaches, Jacksonville would not have to make payments on the issuance of the new $81 million bond.”

The state Education Board’s rejection validated the concerns of some PCSSD board members that district leaders had cobbled together an ill-conceived payment plan on the backs of district personnel requiring drastic staff cuts.

The money is intended for construction of a new high school in Maumelle and new middle school in Sylvan Hills. The bid for bond approval failed 3-4.

Before they were forced to resign, both Superintendent James Sharpe and Chief Financial Officer Larry O’Briant warned the board it could not afford the bond issue.

The board is also deciding whether to reapply to the state board to issue the bonds or scrap the construction plans.

Some PCSSD board members — including Shana Chaplin, Danny Gilliland and Mildred Tatum — Saturday night in a special meeting warned PCSSD board president Tim Clark of Maumelle that the plan he and McGill had hatched to pay off the bonds over 27 years might not bear scrutiny and in large part was conceived in secret.

Clark has been pushing for the mega high school in his Maumelle zone to be state-of-the-art and some board members say he’s ignored board policy if not state law.

The proposal included cutting a dozen or more vice principal positions to save $1.9 million a year, then restoring them with economic stimulus funds for job creation.
Commissioners were bothered that the proposed budget reduction, needed to meet debt payments, largely targets salaries.

As it was hammered out by the Pulaski County School District board at the special meeting Saturday night, the cuts include reducing administrators’ and teachers’ annual paid contracts by two days, cutting some assistant principals and other administrative positions, making the district’s food service more cost efficient and discontinuing payments to teachers who opt to take on bus duty.

Instead, the district would revert to a previous policy of mandated rotating bus duty for all teachers.

Commissioner Brenda Guilland called the idea “a real step backward” for teachers “who are professionals.”

McGill told state commissioners that the debt repayment plan did not consider any loss of revenue that would come with the district’s release from desegregation monitoring, because the timeline is unknown and is contingent upon the courts and any future negotiations that would occur with the separation of the north Pulaski schools from the larger county district.

After the meeting, McGill told reporters that he expected the lost funds would run about $9 million per year.

The timeline for when the funds would be reduced would depend on the federal court ruling on the district’s attainment of unitary status as well as negotiations that would occur between the Pulaski County district and a newly formed Jacksonville school district, were that to occur.

With so many unknowns, the commissioners advised McGill to go back to the board and get a clear plan before asking for state approval of the bonds.

Education commissioner Ken James cautioned his colleagues against approving “something of such magnitude without some clarity.”

Sam Ledbetter, a board member, called the request “an uncertain scenario.”

Commissioner Ben Mays said he was against such a large expenditure for “bricks and mortar,” rather than school programs.

Of the $81 million second-lien bond the district seeks, $51.4 million was earmarked for construction of the new high school and $28.6 million to construct the new Sylvan Hills middle school.

If the motion had passed, the district would have increased its bond indebtedness from $75.4 million to $156.8 million. Annual debt service would have doubled to $11 million, an amount that some board members, some commissioners and others say may be beyond the district’s ability to pay.

Commissioners expressed disapproval of the plan to issue bonds before the district had solidified its plan for repaying the new debt, which will amount to about $5.5 million annually, doubling current bond indebtedness.

As it stands, the district proposal does not take into account the loss of funding it will incur when and if its desegregation efforts are released from court-mandated monitoring—an eventual loss of nearly $20 million a year.

The plan also did not factor in the fiscal impact on debt repayment, were an independent north Pulaski County school district created.

That could mean a 30 percent pupil enrollment loss for the Pulaski County Special School District, with each student worth about $6,000 a year in state- foundation aid.

McGill told the state commissioners that their vote of approval was urgently needed so that the construction projects could go forward in time for the schools to open for the 2011-12 school year. After the meeting, McGill told reporters, “We’ll come back with a detailed plan to convince them in May.”

McGill told the commissioners that the school board is not obligated to negotiate the proposed budget cuts with the Pulaski Association of Classroom Teachers and the Pulaski Association of Support Services, but that he intended to seek their approval before a final board vote.

He allowed that “would be a challenge” and “they may have their lists (of preferred budget cuts).”

“I want to look at those before I make my recommendation to the school board,” he said.

Marty Nix, president of the Pulaski Association of Classroom Teachers, said any change in teachers duties and compensation must be part of contract negotiations.

“The biggest issue is getting into the buildings by August 2011. Equivalent funding reductions will be approved by May 20,” McGill said. “They (the board) are committed to finding the money.”

McGill said that the decision was because “we hear complaints about our buildings over and over again – that’s something we have to fix.”