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The Pleasanton school board tonight will look at the possibility of borrowing money from a fund set up with the sale of property — known as the Sycamore fund — to pay for a facilities master plan already approved by the district.
The district has been using the fund, which was set up for technology improvements in the district, as a sort of revolving loan to itself. In 2001, the Sycamore fund stood at more than $7.2 million. Now it’s down to a little over $4.9 million, with more than $2.4 million owed by the district.
The move is not up for a vote this evening; Board Member Valerie Arkin asked the district to consider other sources to pay for the facilities master plan, which will cost the district $263,910, along with another $28,550 for an updated demographer’s report.
The last demographer’s report came under fire at a special meeting to discuss the district’s debt; members of the audience who attended that meeting said some of the projects listed in that report would be in places where homes couldn’t be built and in other places were construction is unlikely at best.
Also on the agenda for the meeting tonight is transitional kindergarten. The state-mandated plan would change the entry date for kindergarten to 5 years old by Nov. 1, with younger children sent to transitional kindergarten instead.
The idea would send older, more mature children to regular kindergarten, and send younger ones to the transitional program, which would be taught by teachers and include structured play as well as elements from traditional kindergarten. The proposal discussed by the board at its last
The board will also hear a proposal to allow early retirement for some longtime employees. If 59 employees take an early retirement package, that would allow the district to avoid 59 anticipated layoffs.
Homework is also on the agenda for tonight. The board will hear a mid-year report on changes to homework policy that were implemented at the beginning of the school year.
The school board meets in the district’s headquarters at 4665 Bernal Ave.
“…some of the projects listed in that report would be in places where homes couldn’t be built and in other places were construction is unlikely at best.”
Amazing how Pleasanton Unified says that in the Radum CA quarry site (http://206.110.20.201/BusinessServices/Downloads/Demographer0910Report100126.pdf) between the Pleasanton Garbage Service Dump and the new Livermore Outlet Mall/Livermore Airport (where there are all those For Sale or For Lease signs for Industrial Sites) the school district says entire residential subdivisions are now being built in the Livermore Airport Protection Zone (I wonder if some of the houses float or are under water?)
How can that be when the Livermore Municipal Airport, City of Pleasanton, City of Livermore and Alameda County know nothing about this according to Figure 4-1 here? http://www.acgov.org/cda/planning/generalplans/documents/LVK_Ch4_Revised_120111.pdf (Fig 4-1)
It could only be paid back if the economy improves. But we know it won’t improve for a very long time. It’ll be business as usual until we have a Republican President and Congress. It pains the heart to see the economy get worse, month after month, especially in this region. I like the idea of taking $250,000.00 out of the paychecks of those who are suggesting this. Can we get that put on the agenda for tonight? Probably not! Oh well, business as usual.
I can’t believe Arkin and Hintzkee are in favor of borrowing. When will it end. More debt for the district, just what we need. Good thing they are up for re-election.
It’s better this unbudgeted spending comes from here than the general fund, which is where they initially planned to take the money from. Yes, right from the kid’s programs.
It would be even better to scrap this study until after we knew more about funding (after the election).
@ More Debt, I’m pretty sure Hintzke and Arkin will be the ones to vote “no” on this – as they have on so many STUPID things that the 3 stooges have voted “yes” on and passed. I hope all those who voted for the stooges are happy. THAT MONEY IS FOR TECHNOLOGY!!! Not a plan we don’t/didn’t need at the moment. PUSD was just forced to cut more tech. money from the budget. I hope the citizens who actually vote in Nov. election keep what is going on in mind and don’t vote 2 more stooges in – I hope that both Hintzke and Arkin run again for the board. We need them on there.
Hintzke and Arkin were begging for this study to be scrapped. The other three refused. This is the last chance to get this crazy spending away from the general fund.
The other three won’t let them vote on scrapping it altogether until after the election – they tried several times.
Can’t scrap the facilities master plan as it will be needed, but it can definitely be delayed, especially at this point in time when there’s still too much uncertainty as to what the revenue from the State is going to look like.
It all goes back to what they think the community(parents) will pony up more money for later. I’m sure they think of ‘course parents will contribute for technology in a couple of years… who doesn’t want the best technology in their schools?’
But will parents contribute for a high priced consultant study? I don’t think so.
Don’t spend money you don’t have. Sure, I would like to update and expand my house. But I don’t have the money to pay for it or money for the extra monthly payment of a loan…. so I’m not calling any architects. Seems like the school board needs to learn that lesson.
sorry, when I said scrap, I meant until after the election (that is what Arkin had proposed) when we know more about funding. Plus we need to learn more from the city before spending this money makes sense.
Does borrowing from the Sycamore fund increase PUSD’s debt service ratio and affect future borrowing? For example, will it be more expensive for taxpayers to borrow money to build a new school because of new debt owed to the Sycamore fund? Which is the tougher decision to make: delay funding of the facilities master plan until a clearer picture of revenue emerges or increasing borrowing costs?
(See also http://www.pleasanton.k12.ca.us/educationalservices/pupilservices/Downloads/Recommended%20Best%20Practices%20%208-22-11.pdf from the recent bond oversight consultant for best practices on debt limit policies.)
For that matter, what _is_ PUSD’s current debt service ratio?
The Facility Plan needs to be scrapped. It should not have been approved in the first place. No more consultants paid for doing studies!
No one will vote for another bond measure in this town to upgrade facilities when they find out the taxpayers in Pleasanton still owe about $124 million from Measure A and Measure B.
I’m sure PUSD wants a brand new $500 bond measure bond so it can repay the $124 million it still owes. And have our great great great great grandchildren inherit their debt.
Taxpayers will be paying for Measure A/B through 2024. As far as short term debt which is not really short term, but long term debt, the District owes $27 million that will be paid through 2030.
We need an administration and superintendent that understands you just can’t keep borrowing and borrowing and borrowing money.
Stacey, the district has used Certificates of Participation that they don’t have the money to pay back. It is like going down to the pawn shop by mortgaging facilities that the taxpayers have already paid to have built in the first place.
It only takes the vote of the Board to take public property down that has been paid for to the pawn shop and get a loan. The Certificates of Participation scheme works like this: The School owns a piece of property, a middle school, for example.
Without the opportunity to have the voters vote on it, the Board gives title to the middle school to some outside corporation/trustee so the Board doesn’t really own it any more. Then the school board has to pay ‘rent’ in the form of COP payments to lease that space so that students can be educated, paying the rent to these investors from the General Fund.
Default on the COP payments and no more middle school. It is seized.
And that is what the District has done.
Borrowing from the Sycamore Fund does not increase the debt ratio. It is an internal borrowing.
Was also told that the COP debt is not counted as part of the debt ratio. The COPs are technically not a loan. They are a leaseback. The district transfers the asset (in this case Harvest Park Middle School) to a corporation, and then we make “lease” payments on it. Once the “lease” is completely paid off, the asset (Harvest Park) gets transferred back to the district. I was sent a copy of the official COP document from Piper Jaffray and it states “Neither the Certificates nor the obligation of the District to make lease payments constitutes a debt of the District… within the meaning of any constitutional or statutory debt limitation or restriction.” It seems that a COP is another way to get a loan but not count it against your debt limit (sneaky way to get around it). I think this is the same firm that did the cash-out refinancing of our Bonds, which was deemed illegal.
Radumton,
I agree that the COP method of financing seems dubious since it allows an agency to take on public debt without a vote of the people as required in the California Constitution. Besides that though, the districts ability to afford debt is of greater concern.
Do you know what the current PUSD debt service ratio is? I was unable to find it in the latest “debt study” board packet nor in the budget. Compare with the City’s budget document which lists projected debt service ratio through to 2013 (a healthy 2-3%): http://www.ci.pleasanton.ca.us/pdf/2011-12-2012-13FINALPDF.pdf
A lender would look at PUSD’s debt service ratio to determine the district’s borrowing costs. I’m wondering if borrowing from another fund increases that ratio.
long time parent,
Thanks for the answer on internal borrowing. I don’t see though how COPs would not be part of the debt service ratio, especially if they’re secured by the General Fund.
“Neither the Certificates nor the obligation of the District to make lease payments constitutes a debt of the District… within the meaning of any constitutional or statutory debt limitation or restriction.”
Oh, it’s debt alright; just not considered to be debt that needs a vote of the people.
(Hint: See City’s budget document, page 43, which includes COPs as part of debt service ratio.)
Stacey, you are right, it is debt in that payments are owed to a third party. But the District promised ‘housing futures’ in the form of taking the theoretical ‘holding capacity’ of land to hold houses (even when the land isn’t even zoned for residential and some that is not even in the city limits) as security that they would have adequate incoming developer fees to pay back payments of the underlying COPs.
And they say the source of the information for these ‘housing futures?’ The city of Pleasanton.
And just like the Berkeley chief of police is in hot water for sending an officer to a reporter’s house in the middle of the night to issue a ‘story correction,’ this school district administration is more concerned about “try(ing) to get ahead of the inaccurate media spin” than addressing legitimate public questions about PUSD’s process for justifying debt and its plans for repaying it.
Maybe they should call the fake subdivision Radum Ranch. Or Radum Grove. Or maybe Radum Lakes.
They should keep the existing sign though.
http://www.google.com/imgres?imgurl=http://streetview.merchantcircle.com/480X360/6/9/4/7/4256947.JPG&imgrefurl=http://www.merchantcircle.com/business/Kaiser.Sand.And.Gravel.925-846-8800&h=360&w=480&sz=18&tbnid=yfdRJuGDPQVFVM:&tbnh=95&tbnw=126&prev=/search%3Fq%3Dkaiser%2Bsand%2Band%2Bgravel%26tbm%3Disch%26tbo%3Du&zoom=1&q=kaiser+sand+and+gravel&docid=3PUW4PNFEEgoGM&hl=en&sa=X&ei=D3BfT6WOAYrniAL2-vSwBA&ved=0CDoQ9QEwAzgK&dur=4185
So glad I took the money and ran the hell out of P-town. Sounds like
business as usual there. I moved to a red state a d had to show my ID
twice to vote. I’m so thrilled to live in a state that’s not PC whipped and has common
sense.
Board meeting:
Valerie Arkin: can we discuss delaying the facilities master plan at the next meeting?
Jamie: I’d talk about it …
Everyone else . . . Shuffling paper not looking up . . .
Laursen – So that’s a no then. . .
Let’s see. For facilities —
With Measure A, they asked taxpayers to fork over $85 million
With Measure B, they asked taxpayers to fork over $69 million
What $124 million still owed on the balance, what absolutely insane dollar amount do you think they’ll try to get on the ballot this time?
(P.S. do they spend all of their time just trying to come up with parcel tax and bond measure campaigns?)
Key sentences: “In 2001, the Sycamore fund stood at more than $7.2 million. Now it’s down to a little over $4.9 million, with more than $2.4 million owed by the district.”
Another bad habit remains after the retirement of the last superintendent–borrowing. If the district hasn’t paid the $2.4 million back yet, how are we to believe it will ever be repaid? And why would we borrow at a time when technology in the classroom (iPads for instance) is advancing? Where does the district reserve stand? How ’bout we take the $250,000 out of the paychecks of those who insisted on this study?
Is the entire cost of early retirement explained? Is it a golden handshake and lifetime benefits?
It will be business as usual until this community demands otherwise.
“Percy,” Wouldn’t be counting on a Republican president and congress anymore than those in power now. It was a lousy idea to move ahead with this study when there was no money for it and more cuts were obviously on the horizon ($5.3 million shouldn’t have been a surprise).