WHAT DOES A BOND ISSUE HAVE TO WITH PAYING/KEEPING TEACHERS?

There is a common misunderstanding that bonds are only used for construction of facilities. Bond funds can be used to purchase any asset utilized by the school system. Bonds cannot, however, be used to pay salaries or other types of expenses not related to tangible assets.

There are four funds in Oklahoma public school districts:

· Child Nutrition Fund – student meal fees – no local tax dollars – no impact on this discussion

· Building Fund – 5 mill property tax, capped by the Oklahoma Constitution

o Only provides approximately $1.00/sq ft. for operation and maintenance of BPS facilities, which is not adequate; other public institutions regularly spend three times that amount and private entities often spend much more

· General Fund – 35 mill property tax, capped by the Oklahoma Constitution

o This pays the vast majority of district operational costs

o Under state law, all teacher salaries and benefits expenses must be paid from this fund

· Bond Fund – property tax that varies with local authorization

o Pays for any authorized asset utilized by the school system

o Also called “sinking fund” because bonds are paid off over time, so millage will decline unless voters later approve additional bonds

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In short, only the General Fund can pay for teacher salaries and benefits but it cannot be increased by local voters. Only the Bond Fund can be increased, but it cannot pay for teacher salaries and benefits.

As a result, protecting dollars available for teachers means that we must cover as many eligible expenses as possible with Bond Fund dollars. That is precisely what the election on August 23 does.

There are stark examples of the choices we will face if additional bonds are not approved:

1. The district has identified five years of building maintenance issues that total $4.7 million. Not paying for these known issues with bond funds means that they will have to be paid from the general fund as they become critical problems. That will leave less money for teachers.

2. In the next two to three years we will have to replace up to 15 buses due to their advanced age. We can do so now through a bond issue or as they fail with general fund dollars. Each bus is approximately $100,000, an amount equivalent to the average total salary and benefits of 2.5 teachers.

3. Recently the district has spent approximately $300,000 annually for the purchase of textbooks. The legislature cut all of textbook funding from the 2016-2017 state budget. Approval of the bond will pay for textbooks, or we can take $300,000 out of the only fund we have for teachers. That amount is equivalent to the average total salary and benefits of 7.5 teachers.