Hartnell College officials are seeking volunteers to take part in the Citizens’ Bond Oversight Committee, which will oversee expenditures of Measure T, the $167 million facilities bond approved in November.
Measure T funds will be used to construct new facilities and make improvements to existing facilities within the Hartnell Community College District, including a new campus in Soledad.
The bylaws, application form, and ethics statement can be accessed on the college website here. Additionally, there is more information about Measure T and its projects.
Applications and signed ethics statement must be submitted by Friday, March 10. Send application and signed ethics statement via email to lserrano@hartnell.edu, fax to (831) 753-7941, or regular mail to Hartnell Community College District, Office of the Superintendent/President, 411 Central Avenue, Salinas, CA 93901
Applications will be reviewed and recommendations will be forwarded to the Board of Trustees of the Hartnell CCD, who will make final appointments.
Showing posts with label bonds. Show all posts
Showing posts with label bonds. Show all posts
Tuesday, February 21, 2017
Wednesday, August 24, 2016
MPUSD to discuss building priorities
Trustees with the Monterey Peninsula Unified School District will conduct a study session Friday, Aug. 26, to develop a criteria and priorities list of its next set of Measure P bond projects.
The board will receive information on future facilities needs categories including infrastructure, school/classroom facilities, athletics, and student programs.
Approximately $55 million in bond funds remains on the district's Measure P bond measure. Measure P was passed by over 71 percent of district voters in 2010. School facilities throughout the district are in need of significant modernization and upgrade due to age and programmatic need.
The meeting will take place at 5:30 p.m. Friday in the board room of the district office, 700 Pacific St., Monterey.
The board will receive information on future facilities needs categories including infrastructure, school/classroom facilities, athletics, and student programs.
Approximately $55 million in bond funds remains on the district's Measure P bond measure. Measure P was passed by over 71 percent of district voters in 2010. School facilities throughout the district are in need of significant modernization and upgrade due to age and programmatic need.
The meeting will take place at 5:30 p.m. Friday in the board room of the district office, 700 Pacific St., Monterey.
Tuesday, July 26, 2016
MPC trustees hold special meeting
And there are only two items on the agenda: whether to place a bond in the November ballot and whether the board approves the self-evaluation report that's to be delivered to the Accrediting Commission for Junior and Community Colleges. The accrediting team is scheduled to visit MPC in October.
It's still unclear how much would the college be asking in bonds or what the money would be used for, so attending the meeting could help to find out. Stay tuned.
The meeting takes place at 2 p.m. at the MPC library.
It's still unclear how much would the college be asking in bonds or what the money would be used for, so attending the meeting could help to find out. Stay tuned.
The meeting takes place at 2 p.m. at the MPC library.
Monday, May 16, 2016
MPC refinances one of its bonds, saves money in the long run
Monterey Peninsula Community College District officials have refinanced a portion of its bonds to get lower interest rates. Which means that taxpayers will end up paying less for them in the long run.
The bonds will now carry an interest rate of 2.8 percent, down from 5 percent. The rate will begin in 2017 and will continue until 2034. By refinancing its bonds, college officials say they have saved the community about $30 million since 2005.
“The Measure I Bonds have literally transformed our Monterey campus and allowed the district to serve our communities better by adding centers in Marina and Seaside," College President Walter Tribley said in a statement.
Approved in 2002, Measure I brought $145 million into MPC that was used to renovate old facilities and build new ones. Some of the projects financed were the renovation of the pool, the students services center and the Marina campus.
The bonds will now carry an interest rate of 2.8 percent, down from 5 percent. The rate will begin in 2017 and will continue until 2034. By refinancing its bonds, college officials say they have saved the community about $30 million since 2005.
“The Measure I Bonds have literally transformed our Monterey campus and allowed the district to serve our communities better by adding centers in Marina and Seaside," College President Walter Tribley said in a statement.
Approved in 2002, Measure I brought $145 million into MPC that was used to renovate old facilities and build new ones. Some of the projects financed were the renovation of the pool, the students services center and the Marina campus.
Wednesday, January 20, 2016
Hartnell brings savings to taxpayers with refinance of Capital Appreciation Bonds
Hartnell administrators recently finished refinancing nearly $95 million in bonds, including some Capital Appreciation Bonds, which can carry a higher-than usual interest rate and could therefore be more costly for taxpayers.
As a result, taxpayers could end up saving $175 million in the long run, Hartnell officials said.
The bonds were approved in 2002 for Measure H to finance college renovations. The money was used to build the library, the student center, the Alisal campus, and the science center.
Capital Appreciation Bonds became an issue in 2012, when it was learned that the Poway Unified School District near San Diego approved issuing a $105 million bond that could ultimately cost local taxpayers about $1 billion to repay. The controversy led to legislation to modify their use, although school districts are still able to use them.
One of the bonds Hartnell used was a CAB, as it's commonly known. Officials always argued the bonds would be financed because their repayment would become too expensive.
The new bonds were sold with an average interest rate of 4.25 percent with the final maturity of 2049. So at least until then, the taxpayers will be paying for those gleaming buildings.
As a result, taxpayers could end up saving $175 million in the long run, Hartnell officials said.
The bonds were approved in 2002 for Measure H to finance college renovations. The money was used to build the library, the student center, the Alisal campus, and the science center.
Capital Appreciation Bonds became an issue in 2012, when it was learned that the Poway Unified School District near San Diego approved issuing a $105 million bond that could ultimately cost local taxpayers about $1 billion to repay. The controversy led to legislation to modify their use, although school districts are still able to use them.
One of the bonds Hartnell used was a CAB, as it's commonly known. Officials always argued the bonds would be financed because their repayment would become too expensive.
The new bonds were sold with an average interest rate of 4.25 percent with the final maturity of 2049. So at least until then, the taxpayers will be paying for those gleaming buildings.
Friday, October 3, 2014
Pacific Grove residents inform community about Measure A school bond measure
The Yes on Measure A committee will be holding an information event at 6:30 pm on Tuesday, October 7.
The event will feature speakers discussing how Measure A, an $18 million bond measure to be used for updating technology needs at the Pacific Grove Unified School District. Proceeds will be used to buy computers, laptops, and update the districts internet infrastructure to give students the tools they need to succeed in the modern educational landscape.
Refreshments will be served. The event will be held at Peninsula Christian Center, 520 Pine Avenue, Pacific Grove. Free and open to the public. For more information, click here.
The event will feature speakers discussing how Measure A, an $18 million bond measure to be used for updating technology needs at the Pacific Grove Unified School District. Proceeds will be used to buy computers, laptops, and update the districts internet infrastructure to give students the tools they need to succeed in the modern educational landscape.
Refreshments will be served. The event will be held at Peninsula Christian Center, 520 Pine Avenue, Pacific Grove. Free and open to the public. For more information, click here.
Friday, March 7, 2014
Hartnell provides report on Measure H bonds
If you want to get a rundown on how Hartnell's been spending bond funds, administrators have just posted the 2012-13 annual report on their website.
You can find it here. It even has a cool rendition of what the science building will look like.
Residents of the Hartnell Community College District voted in 2002 to pass Measure H, a $131 million general obligation bond measure. The purpose of the bond measure was to address education facilities needs within the Hartnell. Over the life of the bond measure, the district has built many new buildings and has renovated and modernized many others, including the Alisal Campus and the King City Education center.
The final facility to be built with Measure H funds is the 56,000 sq. ft. science building. Construction on this project is scheduled to begin soon.
Incidentally, Hartnell administrators recently re-financed a portion of the bonds that carried an average interest of 5.3 percent to an average of 3.32 percent, reducing the community’s tax bill by $2,280,289 over the next 16 years.
No calculations were available as to how much that translates per home.
The refinance was not of Series D bonds, which are capital appreciation bonds that carry a higher repayment ratio and are usually more expensive. The earliest Hartnell will be able to refinance those bonds will be in 2017-19, President Willard Lewallen said.
You can find it here. It even has a cool rendition of what the science building will look like.
Residents of the Hartnell Community College District voted in 2002 to pass Measure H, a $131 million general obligation bond measure. The purpose of the bond measure was to address education facilities needs within the Hartnell. Over the life of the bond measure, the district has built many new buildings and has renovated and modernized many others, including the Alisal Campus and the King City Education center.
The final facility to be built with Measure H funds is the 56,000 sq. ft. science building. Construction on this project is scheduled to begin soon.
Incidentally, Hartnell administrators recently re-financed a portion of the bonds that carried an average interest of 5.3 percent to an average of 3.32 percent, reducing the community’s tax bill by $2,280,289 over the next 16 years.
No calculations were available as to how much that translates per home.
The refinance was not of Series D bonds, which are capital appreciation bonds that carry a higher repayment ratio and are usually more expensive. The earliest Hartnell will be able to refinance those bonds will be in 2017-19, President Willard Lewallen said.
Wednesday, February 5, 2014
MPUSD holds a special meeting on bonds
Monterey Peninsula Unified officials will have a "study session" to receive reports on how the bond money's been spent, how much has been accomplished, and what's left to be done.
If you're interested to see where half of the $110 million has gone, this is your chance to hear it directly from school administrators. The meeting starts at 5:30 pm. at the district's office, 700 Pacific St., Monterey.
Take pictures and tweet for me, please.
If you're interested to see where half of the $110 million has gone, this is your chance to hear it directly from school administrators. The meeting starts at 5:30 pm. at the district's office, 700 Pacific St., Monterey.
Take pictures and tweet for me, please.
Tuesday, September 10, 2013
Pacific Grove and North Monterey County will ask voters to approve school bonds
Along with the myriad candidates seeking office at local school boards, two school districts want voters to approve bonds for infrastructure and technology upgrades.
Measure G will ask voters of PG Unified to let them issue $27.8 million in short term bonds.
Measure H will benefit North Monterey County Unified, which for years has decried the poor shape of some of its buildings. That bond would be $23.8 million.
Measure H campaign folks will host an information session at 5:45 p.m. on Monday, Sept. 16, at La Scoula Building, 10700 Merrit St., Castroville. For more information, contact Lori Miranda, the campaign's chair, at 831-235-3842.
Measure G will ask voters of PG Unified to let them issue $27.8 million in short term bonds.
Measure H will benefit North Monterey County Unified, which for years has decried the poor shape of some of its buildings. That bond would be $23.8 million.
Measure H campaign folks will host an information session at 5:45 p.m. on Monday, Sept. 16, at La Scoula Building, 10700 Merrit St., Castroville. For more information, contact Lori Miranda, the campaign's chair, at 831-235-3842.
Thursday, May 9, 2013
Hartnell approves lease-leaseback agreement -- and project labor agreement
At a crowded meeting Tuesday, Hartnell trustees approved a "lease-leaseback" agreement to develop the colleges new science building in the heart of the main campus.
But the agreement wasn't approved as originally proposed. Administrators proposed the lease-leaseback agreement to be approved without requiring project labor agreements. That original proposal failed 3-4, with Trustees Erica Padilla-Chavez, Pat Donohue and Candi DePauw for and Bill Freeman, Ray Montemayor, Demetrio Pruneda, and Elia Gonzalez-Castro against.
Montemayor then amended the proposal to include requirements of a project labor agreement, Spokeswoman Terri Pyer said. Project labor agreements demand union shops be brought on board for the construction part of the project. Critics had said this process could end up driving up costs, but friends of labor prevailed. Besides Montemayor, the amendment was supported by Pruneda, Freeman, and Gonzalez-Castro.
The amendment also requires that three trustees will participate in the negotiations of the project labor agreements.
The room was packed, mostly with supporters of project labor agreements, according to Hartnell Spokeswoman Terri Pyer.
But the agreement wasn't approved as originally proposed. Administrators proposed the lease-leaseback agreement to be approved without requiring project labor agreements. That original proposal failed 3-4, with Trustees Erica Padilla-Chavez, Pat Donohue and Candi DePauw for and Bill Freeman, Ray Montemayor, Demetrio Pruneda, and Elia Gonzalez-Castro against.
Montemayor then amended the proposal to include requirements of a project labor agreement, Spokeswoman Terri Pyer said. Project labor agreements demand union shops be brought on board for the construction part of the project. Critics had said this process could end up driving up costs, but friends of labor prevailed. Besides Montemayor, the amendment was supported by Pruneda, Freeman, and Gonzalez-Castro.
The amendment also requires that three trustees will participate in the negotiations of the project labor agreements.
The room was packed, mostly with supporters of project labor agreements, according to Hartnell Spokeswoman Terri Pyer.
Thursday, April 18, 2013
MPC bonds refinanced -- with savings attached
It took a few months for the paperwork to go through, but Monterey Peninsula College district administrators finally re-financed a $28 million bond in a deal that will save taxpayers nearly $1.4 million.
The bond is part of Measure I, the $145 million in bonds approved in 2002 to build MPC 's Marina center and rebuild the Monterey campus.
MPC administrators began the process earlier this year, and were able to reduce the interest rate of the bond from 4.9 percent to 1.69 percent a year.
The bond refinanced is not a "capital appreciation bond," which became infamous last year after media reports publicized that Poway Unified School District in San Diego County will end up paying $1 billion in interest on $105 million in capital appreciation bonds that will mature in 22 to 40 years.
Two weeks ago, the California State Assembly approved a bill that would limit the duration of capital-appreciation bonds to 25 years, prohibit debt payments of more than four times the principal and mandate the option of early repayment on deals that mature in more than 10 years.
MPC will not receive any part of the savings. However, taxpayers living in the MPC district boundaries will see their tax rates reduced as a result of this transaction.
The bond is part of Measure I, the $145 million in bonds approved in 2002 to build MPC 's Marina center and rebuild the Monterey campus.
MPC administrators began the process earlier this year, and were able to reduce the interest rate of the bond from 4.9 percent to 1.69 percent a year.
The bond refinanced is not a "capital appreciation bond," which became infamous last year after media reports publicized that Poway Unified School District in San Diego County will end up paying $1 billion in interest on $105 million in capital appreciation bonds that will mature in 22 to 40 years.
Two weeks ago, the California State Assembly approved a bill that would limit the duration of capital-appreciation bonds to 25 years, prohibit debt payments of more than four times the principal and mandate the option of early repayment on deals that mature in more than 10 years.
MPC will not receive any part of the savings. However, taxpayers living in the MPC district boundaries will see their tax rates reduced as a result of this transaction.
Thursday, January 17, 2013
Tom Torlakson cracking down on Capital Appreciation Bonds
In a joint letter with State Treasurer Bill Lockyer, California Superintendent of School Tom Torlakson today urged school administrators against issuing Capital Appreciation Bonds until new legislation is completed.
"We urge you and your Board of Education not to issue CABs until the Legislature and the Governor have completed their consideration of this year’s proposals to reform the CAB issuance process by improving transparency and protecting taxpayers against exorbitant debt service payments," the letter reads
Dear County and District Superintendents:
We understand many districts face a critical need to build or modernize facilities for their children, and we recognize that falling property tax assessments, revenue losses, and statutory debt service limits have all combined to reduce districts’ debt financing options. As a result, some districts have turned to capital appreciation bonds (CABs), which have forced taxpayers to pay more than 10 times the principal to retire the bonds.
Thus, we urge you and your Board of Education not to issue CABs until the Legislature and the Governor have completed their consideration of this year’s proposals to reform the CAB issuance process by improving transparency and protecting taxpayers against exorbitant debt service payments. Through this process, we welcome and encourage your input to ensure that the needs of districts are still being met.
In too many cases, CAB deals have forced taxpayers to pay more than 10 times the principal to retire the bonds. Also, the transactions have been structured with 40-year terms that delay interest and principal payments for decades, resulting in huge balloon payments and burdens on future taxpayers that cannot be justified. Too frequently, board members and the public have not been fully informed about the costs and risks associated with CABs. In some cases, board members have reported they were not even aware they approved the sale of CABs.
It is important to note that CABs with terms exceeding 25 years place the repayment obligation on future taxpayers who likely will not benefit from the capital improvements financed by the CABs. At the same time, the CABs payments will reduce those taxpayers’ capacity to finance construction and modernization projects their own children will need.
We are convinced that remedial legislation is needed to prevent abuses and ensure that both school board members and the public obtain timely, accurate, complete, and clear information about the costs of CABs, and alternatives, before CABs are issued. The Governor has told us he wants reforms. Key lawmakers and legislative leaders have made clear they agree statutory changes are needed.
For all these reasons, we believe your district and every other district in the state should impose a moratorium on issuing CABs. The moratorium should remain in effect until the Governor and Legislature decide on reforms in the current legislative session. If reforms are enacted, subsequent CABs deals can be conducted in compliance with the new statutory requirements.
Thank you for your consideration. Should you have any questions or concerns, please contact Jeannie Oropeza, Deputy Superintendent, California Department of Education, by e-mail at joropeza@cde.ca.gov.
Sincerely,
Tom Torlakson
Bill Lockyer
"We urge you and your Board of Education not to issue CABs until the Legislature and the Governor have completed their consideration of this year’s proposals to reform the CAB issuance process by improving transparency and protecting taxpayers against exorbitant debt service payments," the letter reads
Dear County and District Superintendents:
We understand many districts face a critical need to build or modernize facilities for their children, and we recognize that falling property tax assessments, revenue losses, and statutory debt service limits have all combined to reduce districts’ debt financing options. As a result, some districts have turned to capital appreciation bonds (CABs), which have forced taxpayers to pay more than 10 times the principal to retire the bonds.
Thus, we urge you and your Board of Education not to issue CABs until the Legislature and the Governor have completed their consideration of this year’s proposals to reform the CAB issuance process by improving transparency and protecting taxpayers against exorbitant debt service payments. Through this process, we welcome and encourage your input to ensure that the needs of districts are still being met.
In too many cases, CAB deals have forced taxpayers to pay more than 10 times the principal to retire the bonds. Also, the transactions have been structured with 40-year terms that delay interest and principal payments for decades, resulting in huge balloon payments and burdens on future taxpayers that cannot be justified. Too frequently, board members and the public have not been fully informed about the costs and risks associated with CABs. In some cases, board members have reported they were not even aware they approved the sale of CABs.
It is important to note that CABs with terms exceeding 25 years place the repayment obligation on future taxpayers who likely will not benefit from the capital improvements financed by the CABs. At the same time, the CABs payments will reduce those taxpayers’ capacity to finance construction and modernization projects their own children will need.
We are convinced that remedial legislation is needed to prevent abuses and ensure that both school board members and the public obtain timely, accurate, complete, and clear information about the costs of CABs, and alternatives, before CABs are issued. The Governor has told us he wants reforms. Key lawmakers and legislative leaders have made clear they agree statutory changes are needed.
For all these reasons, we believe your district and every other district in the state should impose a moratorium on issuing CABs. The moratorium should remain in effect until the Governor and Legislature decide on reforms in the current legislative session. If reforms are enacted, subsequent CABs deals can be conducted in compliance with the new statutory requirements.
Thank you for your consideration. Should you have any questions or concerns, please contact Jeannie Oropeza, Deputy Superintendent, California Department of Education, by e-mail at joropeza@cde.ca.gov.
Sincerely,
Tom Torlakson
Bill Lockyer
Monday, December 3, 2012
School Bonds 101 -- a financial lesson for the ages
Thanks to the report in the L.A. Times, I've now fully jumped into the bonds bandwagon. Suffice to say, it's not fun.
A recap: an L.A. Times report rang alarm bells on Capital Appreciation Bonds, which accrue enormous amount of interest and could sock the taxpayers with huge repayments for funds borrowed through bonds to build schools, etc. I blogged about it last week.
The issue, as usual, is a lot more complicated than that. No wonder sometimes experts hate us journalists for being overly simplistic.
Don't take my word for it. Take a look at the documents that spell out the obligations that both buyers and sellers get into when trading bonds. Series D of Hartnell bonds, sold in 2009, can be found here. The most recent issue of MPUSD bonds can be found here.
Naturally, I don't expect anybody to read them. That's my job. So by the end of the week, expect a full report. In the meantime, pass the aspirin.
A recap: an L.A. Times report rang alarm bells on Capital Appreciation Bonds, which accrue enormous amount of interest and could sock the taxpayers with huge repayments for funds borrowed through bonds to build schools, etc. I blogged about it last week.
The issue, as usual, is a lot more complicated than that. No wonder sometimes experts hate us journalists for being overly simplistic.
Don't take my word for it. Take a look at the documents that spell out the obligations that both buyers and sellers get into when trading bonds. Series D of Hartnell bonds, sold in 2009, can be found here. The most recent issue of MPUSD bonds can be found here.
Naturally, I don't expect anybody to read them. That's my job. So by the end of the week, expect a full report. In the meantime, pass the aspirin.
Thursday, November 29, 2012
Of school bonds and other demons
The widespread practice among school districts of selling "Capital Appreciation Bonds" is coming into sharp focus this week after the L.A. Times published an investigation on the topic. Here's the link.
School districts statewide have been resorting to selling Capital Appreciation Bonds since the economic bubble burst and pushed down property values. Administrators began to use these bonds banking with the belief that property values will go up, so taxpayers would not be adversely affected. I've also heard from district administrators they plan to refinance the bonds before they become due so the payments are not as high as they're being made to sound on stories like this.
Nine districts in Monterey County have resorted to this type of bonds since 2007: Alisal Union, Bradley Union, Carmel Unified, Gonzales Unified, Greenfield Union, Hartnell College, Monterey Peninsula College, Monterey Peninsula Unified, King City Elementary, and Santa Rita Elementary. Together they've issued about at least $104 million in bonds to finance school construction and renovation.
To my untrained eye, it looks like the only bonds that should raise eyebrows are in Bradley, Carmel, Hartnell and Santa Rita because of their high repayment ratio. But I'll have a chance to look at them more closely in the days to come.
School districts statewide have been resorting to selling Capital Appreciation Bonds since the economic bubble burst and pushed down property values. Administrators began to use these bonds banking with the belief that property values will go up, so taxpayers would not be adversely affected. I've also heard from district administrators they plan to refinance the bonds before they become due so the payments are not as high as they're being made to sound on stories like this.
Nine districts in Monterey County have resorted to this type of bonds since 2007: Alisal Union, Bradley Union, Carmel Unified, Gonzales Unified, Greenfield Union, Hartnell College, Monterey Peninsula College, Monterey Peninsula Unified, King City Elementary, and Santa Rita Elementary. Together they've issued about at least $104 million in bonds to finance school construction and renovation.
To my untrained eye, it looks like the only bonds that should raise eyebrows are in Bradley, Carmel, Hartnell and Santa Rita because of their high repayment ratio. But I'll have a chance to look at them more closely in the days to come.
Monday, June 18, 2012
Measure P update
Administrators with the Monterey Peninsula Unified School District will give an update on projects being paid with Measure P funds, the $110 million bond approved in 2010. They will also focus on future bond phases, and the need for possible selling Bond Anticipation notes (BANs). BANs are short-term interest-bearing security issued in advance of a larger, future bond issue. They can be used if the issue of a larger bond wants to be delayed.
The presentation will take place at a special meeting of the board of trustees at 6 p.m. on Tuesday, June 18. The meeting will take place at the Instructional Materials Center
540 Canyon del Rey, Del Rey Oaks.
The presentation will take place at a special meeting of the board of trustees at 6 p.m. on Tuesday, June 18. The meeting will take place at the Instructional Materials Center
540 Canyon del Rey, Del Rey Oaks.
Wednesday, May 16, 2012
Carmel Unified to gauge support for a new bond
Carmel Unified trustees have given the go ahead to survey potential voters about their support for a new bond measure. It would be the third bond measure in the last decade, and while administrators and trustees have several projects they'd like to see completed, some residents have shown skepticism about more money for the district.
The results of the survey are expected to be presented to the board in early June, according to Superintendent Marvin Biasotti.
The results of the survey are expected to be presented to the board in early June, according to Superintendent Marvin Biasotti.
Friday, May 11, 2012
Hartnell and its bonds, cont'd
On its face, it looks a bit scary. To have to repay $460 million after getting only $48 million in bond money to build two buildings. So the alarm bells were sounded, and about two dozen community members -- including three Hartnell trustees -- attended a special meeting of the district's Citizens' Bond Oversight Committee on Thursday.
It is not exactly the job of the committee to be vigilant about how much interest the college's paying -- that's supposedly a job for the trustees. The committee's responsibility is to make sure the money's spent for its intended uses. But Bob Perkins, chairman of the committee is also vice chair of the Salinas Tax Payer Association, so he convened a special meeting to request some answers.
"We asked for the meeting as citizens, not as the citizen's oversight committee," Perkins announced. (The notice for the meeting, by the way, was advertised as a special meeting of the Citizen's Bond Oversight Committee)
The answers had already been given back in 2009 when the bonds were issued, but the only person who was around back then and is still around to remember is apparently President Phoebe Helm.
At the special meeting Thursday, Helm explained that trustees authorized to issue the type of bonds that accrue interest back then despite their cost because no investor seemed interested in the regular kind of bonds. Not having authorized the sell of those bonds would have risked losing matching funds from the state, would have stopped construction already begun and exposed the college to lawsuits from builders with contracts already signed. At the time, the economy had begun its painful decline, and the bonds that Hartnell had been able to sell at enviable rates back in 2003, 2006, and even in June 2009 were no longer available by September of the same year. So the board voted to get capital appreciation bonds, with the knowledge that they would have to be refinanced in 2019 -- before repayment is scheduled to begin in 2022.
Homeowners in the Hartnell district began paying $17.37 per $100,000 of assessed value in 2003 to begin repaying the bonds, but their payments by law can't be higher than $25. The average they've paid is just under $20.
As comparison, payment for Cabrillo College's two bonds is almost $40. Gavilan's bond is $21.70. Monterey Peninsula's bond is $23.57.
Because college officials had been able to secure such good interest rates in the early bonds, even if the last bond remains at this much higher interest rate, it would all balance out to a repayment of five times -- compared to two times for the first second series of the bond, and three times for the third one.
So the bonds were sold in 2009, and the audit report was issued in 2010, why is all this happening now, asked Faculty President Ann Wright.
It's the political climate, said Helm.
"The issues should be to educate and not to alarm," Helm said. "Specially when you're dealing with what's already been determined."
Julie Tucker, another member of the oversight committee, felt her fears had been assuaged by the special meeting.
"I'm really glad we did this," she said. "I'm very confident things are being monitored."
It is not exactly the job of the committee to be vigilant about how much interest the college's paying -- that's supposedly a job for the trustees. The committee's responsibility is to make sure the money's spent for its intended uses. But Bob Perkins, chairman of the committee is also vice chair of the Salinas Tax Payer Association, so he convened a special meeting to request some answers.
"We asked for the meeting as citizens, not as the citizen's oversight committee," Perkins announced. (The notice for the meeting, by the way, was advertised as a special meeting of the Citizen's Bond Oversight Committee)
The answers had already been given back in 2009 when the bonds were issued, but the only person who was around back then and is still around to remember is apparently President Phoebe Helm.
At the special meeting Thursday, Helm explained that trustees authorized to issue the type of bonds that accrue interest back then despite their cost because no investor seemed interested in the regular kind of bonds. Not having authorized the sell of those bonds would have risked losing matching funds from the state, would have stopped construction already begun and exposed the college to lawsuits from builders with contracts already signed. At the time, the economy had begun its painful decline, and the bonds that Hartnell had been able to sell at enviable rates back in 2003, 2006, and even in June 2009 were no longer available by September of the same year. So the board voted to get capital appreciation bonds, with the knowledge that they would have to be refinanced in 2019 -- before repayment is scheduled to begin in 2022.
Homeowners in the Hartnell district began paying $17.37 per $100,000 of assessed value in 2003 to begin repaying the bonds, but their payments by law can't be higher than $25. The average they've paid is just under $20.
As comparison, payment for Cabrillo College's two bonds is almost $40. Gavilan's bond is $21.70. Monterey Peninsula's bond is $23.57.
Because college officials had been able to secure such good interest rates in the early bonds, even if the last bond remains at this much higher interest rate, it would all balance out to a repayment of five times -- compared to two times for the first second series of the bond, and three times for the third one.
So the bonds were sold in 2009, and the audit report was issued in 2010, why is all this happening now, asked Faculty President Ann Wright.
It's the political climate, said Helm.
"The issues should be to educate and not to alarm," Helm said. "Specially when you're dealing with what's already been determined."
Julie Tucker, another member of the oversight committee, felt her fears had been assuaged by the special meeting.
"I'm really glad we did this," she said. "I'm very confident things are being monitored."
Tuesday, May 8, 2012
Hartnell, its bonds, and its repayment plan
Bob Perkins, chairman of Hartnell bond's citizen oversight committee, is urging members of the public to attend a special meeting where the bond repayment schedule will be discussed.
Since voters approved Measure H in November 2002, Hartnell College has raised $131 million for capital improvements through a series of bond increments. The projects are listed here.
Since the recession took hold, Hartnell College and other school districts around California have resorted to Capital Appreciation Bonds to raise money for capital improvements. Government treasurers have been raising alarms about the long-term costs of paying back this debt, which can total as much as ten times the amount borrowed. Hartnell College’s Capital Appreciation Bonds allowed the college to delay payments for several years. However, once payments begin, they escalate quickly. If tax revenue projections are wrong thirty years from now, Hartnell College could face problems meeting its debt payments.
It looks like a new conversation will begin at Hartnell College about what future options the college might pursue, Perkins writes in an email. "We need to know what restrictions are attached to capital appreciation bonds," he said.
The meeting will take place at 4 p.m. Thursday, May 10, at the Learning Resource Center, Room 105 411 Central Avenue, Salinas
Since voters approved Measure H in November 2002, Hartnell College has raised $131 million for capital improvements through a series of bond increments. The projects are listed here.
Since the recession took hold, Hartnell College and other school districts around California have resorted to Capital Appreciation Bonds to raise money for capital improvements. Government treasurers have been raising alarms about the long-term costs of paying back this debt, which can total as much as ten times the amount borrowed. Hartnell College’s Capital Appreciation Bonds allowed the college to delay payments for several years. However, once payments begin, they escalate quickly. If tax revenue projections are wrong thirty years from now, Hartnell College could face problems meeting its debt payments.
It looks like a new conversation will begin at Hartnell College about what future options the college might pursue, Perkins writes in an email. "We need to know what restrictions are attached to capital appreciation bonds," he said.
The meeting will take place at 4 p.m. Thursday, May 10, at the Learning Resource Center, Room 105 411 Central Avenue, Salinas
Wednesday, April 18, 2012
Eyeing more taxes in Carmel and Salinas
** UPDATE. I stand corrected. The Carmel Unified special meeting is scheduled to take place Thursday, April 19. Thanks to alert reader Marry3000 for the correction.
Administrators with the Carmel Unified School district will host a special meeting THURSDAY to explain how the proceeds from their 2005 bond have been used. They'll also have a cost/benefit analysis of the remaining projects -- some of which are yet to be built. All these eyeing a potential bond to complete some improvements officials still would like to see. And perhaps convince voters their projects are worthwhile.
The special meeting will take place at 4:30 p.m. at the Carmel Middle School library, 4380 Carmel Valley Road, Carmel. While some people seem
I detect increased eagerness from administrators and public officials to ask the voters to tax themselves in benefit of schools and students. Both the Monterey Peninsula Unified and the Salinas Union High school districts are exploring possibilities of tax measures. And there's already signs voters are not excited about the idea.
Administrators with the Carmel Unified School district will host a special meeting THURSDAY to explain how the proceeds from their 2005 bond have been used. They'll also have a cost/benefit analysis of the remaining projects -- some of which are yet to be built. All these eyeing a potential bond to complete some improvements officials still would like to see. And perhaps convince voters their projects are worthwhile.
The special meeting will take place at 4:30 p.m. at the Carmel Middle School library, 4380 Carmel Valley Road, Carmel. While some people seem
I detect increased eagerness from administrators and public officials to ask the voters to tax themselves in benefit of schools and students. Both the Monterey Peninsula Unified and the Salinas Union High school districts are exploring possibilities of tax measures. And there's already signs voters are not excited about the idea.
Saturday, March 17, 2012
A thrift store or a parcel tax for MPUSD?
Honestly, when I saw that MPUSD administrators are considering placing a parcel tax on the ballot, I almost choked. They just got a bond approved. Many parents and some teachers disapprove of the administration and the way they seem to run things. Asking for more money under these circumstances seems best than ideal.
But after thinking about it some more, it made sense. Hiring more teachers for smaller class sizes, art lessons, and extra support, is going to require more money -- healthy reserves notwithstanding. Lots of more. Bond funds cannot be used for operations, unlike a parcel tax, which can be used for general operations. A parcel tax would raise the funds a thrift shop never could.
Now, it'll be interesting to see if all the interested parties can overcome the deeply seated distrust that exist and reach consensus. Getting 67 percent of the vote would be another mountain to climb.
But after thinking about it some more, it made sense. Hiring more teachers for smaller class sizes, art lessons, and extra support, is going to require more money -- healthy reserves notwithstanding. Lots of more. Bond funds cannot be used for operations, unlike a parcel tax, which can be used for general operations. A parcel tax would raise the funds a thrift shop never could.
Now, it'll be interesting to see if all the interested parties can overcome the deeply seated distrust that exist and reach consensus. Getting 67 percent of the vote would be another mountain to climb.
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