Schools “No Cost” Bond issue is Proposition A and B on General Election Ballot
By Becky Brewster
Culberson County-Allamoore ISD is seeking voter approval for a “no cost” bond issue on the May 4, 2019 ballot. The District is looking to the voters to obtain authorization to use the excess funds that are accumulating in the District’s Interest and Sinking (I&S) Fund due to the growth in revenues attributed to the oil and gas development in the northern part of the County. Early voting will begin on Monday, April 22 and end April 30, 2019. The polling place is located at City Hall at 1801 W. Broadway.
There will be two options on the ballot. Proposition B seeks authorization to use a portion of the accumulated I&S Funds to pay off the loan for the 2014 Football Field Construction which is being paid from the District’s Maintenance and Operating (M&O) Funds.
The District is spending almost 10% of its M&O budget for debt ($400,000 per year) that should be used for our students in the classroom. In economic downturns, having debt paid from M&O weakens the school’s financial strength and puts the District at financial risk. CCAISD has gotten by so far by not addressing several academic and logistic needs of the school. But with the increase in the I&S Fund balance, the District does not have to live with this financial risk. The $3,085,000 debt can be paid off with the money already in the District’s I&S Fund balance.
Proposition A seeks authorization to use the excess I&S Fund balance for additional capital improvements that were previously deferred. In 2016, the bond issue was approved with just the most basic need…a new building. At that time, the District determined that the $30 million bond issue was all that the District could afford based on the economic forecasts at that time. However, with the long-term forecasts for continued economic growth due to the oil and gas industry, the District conservatively estimates that it will have $10,500,000 available to spend on many of the deferred projects. The projects would be prioritized and only be done as the funds are available in the I&S Fund. These projects could include such things as upgrades to the auditorium and band hall; upgrades and/or replacements of the school housing; expansion to the bus barn; parking lot improvements; and many other deferred projects.
CCAISD is limited by law and by its bond covenants on the use of the I&S Fund which holds the funds to pay off the bond approved in 2016 to build the new K-12 Campus. The bond covenants restrict the early payoff of the existing bonds, so the District is seeking voter approval to use the excess funds. Remember, although the proposition will be called a “Bond” CCAISD has said it will not levy any additional taxes. In fact, it is anticipated that the I&S levy will begin to decrease as the trend in increased oil and gas revenues continues.