Box Elder School District

Proposed $70,000,000 Bond Election

November 6, 2007

Bear River High School (Current and Proposed)

Video Showing Current Building Structure and Proposed Renovations

Box Elder High School (Current and Proposed)

Video Showing Current Building Structure and Proposed Renovations

Frequently Asked Questions

1.          Why $70,000,000?

The $70,000,000 figure was arrived at by determining what would be a manageable impact on the tax payers of Box Elder County.  The Board of Education decided the maximum tax increase that would be sought would be less than $100 annually on a primary residence worth $100,000.  Although $70,000,000 is a lot of money, and much can be accomplished with these funds, it is estimated that to replace both Box Elder and Bear River High Schools would likely cost in excess of $100,000,000, even if built on the current sites.  The cost may exceed $120,000,000 if land needed to be purchased.

2.          If the School Board chose to do so, could they propose a bond election for the estimated $120,000,000 needed to replace/relocate both high schools?

Yes.  The legal maximum the Board could seek in a bond election is in excess of $130,000,000.   However, using the current restructuring formula, the impact on taxpayers would almost triple if it was $120,000,000.

3.          Why does a bond of $70,000,000 have an impact of approximately $95.00 annually on a home worth $100,000 and a $120,000,000 bond have an impact of approximately $300.00 annually?

A portion of the proposed bond payment will be made from the District’s existing capital budget.  However, the available capacity of the existing budget is limited and therefore if the total amount of the bond were to increase, the total burden of that increase would be solely on the tax payers and result in significantly increased property taxes.

4.      If this bond passes and a portion of the existing capital budget is used to make the annual bond payment, will sufficient funds remain in the capital facilities budget to adequately maintain other existing buildings?

The intent of the Board of Education is to transfer approximately 1/3 of the existing capital budget to offset some of the annual bond payment.   This leaves $2,300,000 for ongoing capital projects.  This is more than double what has been available in the past.

5.          What about the last bond?

In 1993 voters approved a $28,500,000 bond to build the two intermediate schools and some other projects.  This bond was paid off in June of 2006.   A portion of the revenues used to make this bond payment was retained when the bond was paid off last year.  These funds are being used this year to complete the addition at Century Elementary.  Part of these funds will be used to support payments of the new bond if it passes.  The remainder will be used to provide a desperately needed increase in the ongoing capital facilities budget.

6.      The 1993 promised things that were not delivered.  What is being done to assure that this does not happen again?

With the ever rising cost of construction, it is impossible to precisely predict future building costs.  However, estimated construction costs include inflationary adjustments and all efforts are being made to assure that all approved projects will be completed.  Costs are calculated in anticipation of all high school projects being bid within the next 9-15 months.

7.       How is the $70,000,000 in bond dollars being allocated?

The Board of Education decided to allocate 80% of the total bond revenue ($56,000,000) to renovations at the two high schools.  20% ($14,000,000) will be used to address all other needs.

8.      How will the other $14,000,000 be allocated?

It is anticipated that new growth will necessitate a new elementary in the South Willard area in the next five years.   Growth in the Garland and Fielding areas as well as the age and limited capacity of those two schools will also need to be addressed in the next five years.  Although the need is not as pressing as the needs at the two high schools, these needs are real and will need to be addressed.

It is likely that the $14,000,000 will need to be supplemented from ongoing funds or restructuring of the District’s Municipal Building Authority to meet these needs.  It is the intention of the Board of Education to meet these as they arise and not raise taxes or seeking additional funds through another bond election.   Although these schools will not be built/replaced/consolidated immediately, it is best to request authorization for these funds at this time rather than incur the expense of an additional election in the near future.   This election proposal gives authority to issue these bonds as needed.  There is no expense to the taxpayers of the County until the bonds are issued.

Other elementary schools and the intermediate and middle schools should not need significant improvements in the next 10-20 years.

9.     How was the $56,000,000 divided between Box Elder High and Bear River High?

       Based on the following information, the Board of Education allocated 55% ($30,800,000) of the $56,000,000 to Box Elder
      High and 45% ($25,200,000) to Bear River High. 

            a.   As of October 1, 2006, Box Elder High School had 59.37% of the students attending these two high schools and Bear River High School had 40.63%.

            b.   Box Elder High has 220,959 square feet (54.23% of the total of the two schools) and Bear River has 186,505 square feet (45.77% of the total).

            c.   A recent study conducted by Asset Evolution determined the age of Box Elder High to be 45 years and Bear River High to be 56 years.  It is noted that these are calculated ages because both buildings, especially Bear River High, have portions of the building built at different times.

            d.   Asset Evolution also calculates a “Cost Effectiveness Factor” for buildings.  This is a percentage reflective of the costs of maintaining a building versus the costs of new construction.  The Asset Evolution Cost Effectiveness rating for BEHS is 79% and BRHS is 91%.

            e.   Additionally, Asset Evolution also provided an estimated Construction Cost if these two buildings were to be replaced today.   The total for both buildings is $101,866,000 with BEHS at $55,239,750 (54.23% of the total) and BRHS at $46,626,250 (45.77% of the total).

10.   What is the impact on me as a property tax payer in Box Elder County?

The bond will impact the amount you pay on property taxes.  This includes all property (real property and personal property) to which a tax rate applies.   The District’s fiscal year 2006-07 tax rate was .006252.   This means that for every $1,000 in taxable value you paid $6.25 in school property taxes.  If the bond passes, the tax rate may eventually increase by not more than .001766 or $1.77 on each $1,000 of taxable value

The actual increase may be less than $1.77 on each $1,000 of taxable value.   For example, the 2007-08 tax rate is .005958 (without passage of the bond).  If the bond election is successful, the rate would be .005958 + .001766 = .007724.   This results in a increase of .001472 (.007724 - .006252) or an increase of $1.47 on each $1,000 of taxable value

11.    What about my personal home?

In Utah, the taxable value of a primary residence is calculated at 55% of the actual assessed value.  Therefore, if you own and live in a home with an actual value of $145,000, the taxable value is $79,750.   The 2006-07 school taxes on this home were ($79,750 X .006252) $498.60.   The bond will allow the School Board to increase those taxes by a rate of .001766 or $140.84 annually.

12.   What about my business?

Commercial and industrial property is taxed at 100% of its value.  If you own a business with a building worth $175,000 and have $25,000 worth of equipment in the building taxes are assessed against the total value of $200,000.   Therefore the bond will increase your taxes by as much as $353.20 annually ($200,000 X .001766).

13.    What about my farm property?

Agricultural property is the most difficult to easily determine the impact of a tax increase.   The taxable value of agricultural and vacant property varies with the type of property and how the property is currently being used.  As noted above, the bond may increase taxes by $1.73 for each $1,000 of taxable value.  

14.    Is this tax increase permanent?

The current proposal is that bonds will be issued with a 20 year amortization (pay back schedule).   Therefore these increases may be for as many as 20 years from when the bonds are issued.  The last bonds were issued for 15 years, refinanced to lower the payment, and paid off in 12 years.

Bond regulations allow the District to only collect enough taxes to pay the annual bond payment.  If Box Elder County continues to grow as it has the past 10 years, and if additional industry comes into the County, the total assessed valuation of the County will increase.  As this occurs and the amount needed to make the bond payment remains constant, the tax rate will most likely decline over time and could result (depending on the inflationary value of property) tax increases lower that previously noted.

15.    What will the District do if additional schools are needed before this bond is paid off (20 years)?

First, it is anticipated and planned that the proposed improvements to Box Elder and Bear River High Schools will meet the need of those schools for at least the next 20-40 years. 

As other schools are needed or as other schools need significant improvements, the District has several options.

a.   An additional bond election could be held.   This bond for $70,000,000 does not exceed the legal limit ($130,000,000 +) available to the District. 

b.   School additions and remodels could be paid for from ongoing Capital Facilities budgets.   This is currently occurring with the approximately $2,300,000 addition at Century Elementary in Bear River City.  This will be completed without a tax increase on the citizens of Box Elder County.

c.   The District has created a Municipal Building Authority.  This allows for the issuing of limited revenue bonds to be paid from ongoing District funds.  This process was used to build the Three Mile Creek Elementary in Perry and could be used for similar projects in the future.  Again, this school was built without increasing taxes on the citizens of Box Elder County.

16.      If funds are currently available for projects like Three Mile Creek and Century, why not use those funds for the needed improvements to Box Elder High and Bear River High?

This is an option that was given significant consideration by the Board of Education.  However, with the $2-3 million available annually to complete the needed projects it would take at least twenty years to complete the projects proposed to be completed with the proposed bond.   With construction costs increasing at approximately 20% a year and bond money available at 4.5% a year, we can get a lot more “bang for the buck” if we bond and complete the needed construction as quickly as possible.

17.    What do we know about the buildings that are proposed to be built?

At both high schools, the auditoriums, main gymnasiums, and some classrooms will be retained.  This crates significant savings that would be impossible if the two schools were completely rebuilt.  A citizens committee at each high school has worked closely with an architectural firm in designing reconstruction to meet the needs of all students.  Academic classrooms will be replaced, fine arts (music, drama, dance, arts) will be greatly enhanced, cafeterias designed to attract students and keep them on campus are included, athletic facilities will be updated and enlarged to meet the ever increasing needs of the schools and the community.

All new building will include the latest in safety and seismic controls, accessibility for individuals with disabilities, energy conservation, lighting, and environmental controls.   The current proposal does not include refrigerated air but does include vastly improved air movement and climate controls.   All new building will greatly increase student comfort and the learning environment.

Buildings will be designed and built to extend the life of the existing campuses and meet the needs of students far into the future.   Improved design, quality building materials, appropriately engineered and sloped roofs, and other energy saving aspects will decrease the funds needed to maintain these new buildings and free up these funds for other student educational programs. 

18.    How will I be able to vote on this proposal?

The election is scheduled for Tuesday, November 6, 2007.  You can vote on this proposal at the same time you vote for municipal officers.  The ballot will be entitled ”Special Bond Election – School District Proposition Number 1”.  The ballot will include some general information about the bond amounts and the impact on a homes and businesses.  The information contained in the ballot will apply if/when all of the $70,000,000 in bonds are issued.  The impact on home property taxes will be listed as $140 increase annually if your home is valued at $145,000.

If you are in favor of the bond issue, you will mark the box labeled FOR THE ISSUANCE OF THE BONDS.  If you are against the bond issue, select the box labeled AGAINST THE ISSUANCE OF BONDS. 

19.    Will there be other things on the ballot that I can vote on?

If your city is conducting a municipal election this year, this will also be on the ballot.  Additionally, the ballot will allow you to vote on the statewide education voucher issue.   The bond issue and the voucher issue are separate issues.  You can vote for or against either or both of these issues.  They are not related or tied to one another.

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Copyright © Box Elder School District
Last modified: 10/08/07

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Copyright © Box Elder School District
Last modified: 10/08/07