LovelandPolitics
| Loveland's Independent News Source |
Loveland - November 2, 2016
The Loveland Reporter-Herald and Thompson School District (TSD) have been providing voters
misleading information regarding the future liability to property owners of the proposed $288 million
school bond measure named “Thompson Reinvented” found on the ballot as Issue 3E.
The ballot language voters within the Thompson School District are being asked to approve in this
upcoming election is an annual tax increase of $26.7 million as clearly stated in the ballot language. The
current assessment of taxable property values within the school district total an estimated
$1,653,823,393. To raise the authorized new tax, the mill levy on that number would be 16 Mills but
the local media and school district are reporting it to be only 9 Mills or $18 per month for a $300,000
home (see RH article). In fact, the total a yes vote will authorize using current assessments comes to
$32 per month or $384 per year for the bond alone. In addition to a bond, voters are also being asked to
approve a Mill Levy Overide (MLO) of an additional 6.5 mills to raise another $11 million for a total
annual property tax increase authorization of $37.7 million.
The actual tax increase authorized for a $300,000 residential property within TSD, should voters
approve the Bond, MLO and interest rates go up in the future, will be $540 per year or $45 per month.
Because the total indebtedness being requested is $288 million. Therefore, TSD is asking voters to
approve a repayment plan that exceeds the current interest rates in anticipation of future events where
the debt costs can grow significantly.
Just as we learned in the 2008 housing crash, borrowers sometimes focused on their initial "step-in"
payment instead of the total obligation they are making for future payments. In Colorado the TABOR
(Tax Payer’s Bill of Rights) Notice controls what the district will be allowed to do following the election
if 3E passes. That notice states the “maximum annual repayment cost” is “up to $26,700,000 in any
fiscal year.”
Especially misleading are the total tax calculations for Loveland homeowners. Most newer housing
developments have a metro district tax imposed on them for 25 years in addition to the many other
special taxing districts. For example, a $330,000 home in West Loveland’s recently approved Lee
Farms subdivision could pay an annual property tax of $4,364 or $363.69 per month if the proposed
‘Thompson Reinvented’ and MLO are both approved and interest rates rise to allow the maximum
collection votes will be authorizing if the bond measure succeeds.
Another important element missing from the calculations provided by the advocates of taxing ballot
measures is the assessment rate of residential property. Due to an amendment to Colorado’s
constitution adopted by voters in 1983 called the Gallagher Amendment, commercial assessment rates
are fixed at 29% while the residential rates change periodically to reflect 45% of the total tax collected.
The rate has held at 7.98% for many years but the same organizations backing Thompson Reinvented
are working for a repeal of Gallagher which would dramatically increase residential property
assessments.
As an example, a modest increase to only 10% can increase the annual property tax of the same
$330,000 residence in Lee Farms from $4,364 annually or $363.69 monthly to $5,296.50 annually and
$441.38 monthly. Becuase the MLO is a fixed 6.5 Mills, the amount it costs you annually will rise if your
home increases in value.
Ironically, the Loveland City Council has been seeking ways to make housing in the city more
‘affordable’ by increasing subsidies to low-income families. Most of the proponents of government
subsidized housing on Loveland’s City Council are also endorsing the current school bond measure.
The Loveland Reporter-Herald and Thompson School District (TSD) have been providing voters
misleading information regarding the future liability to property owners of the proposed $288 million
school bond measure named “Thompson Reinvented” found on the ballot as Issue 3E.
The ballot language voters within the Thompson School District are being asked to approve in this
upcoming election is an annual tax increase of $26.7 million as clearly stated in the ballot language. The
current assessment of taxable property values within the school district total an estimated
$1,653,823,393. To raise the authorized new tax, the mill levy on that number would be 16 Mills but
the local media and school district are reporting it to be only 9 Mills or $18 per month for a $300,000
home (see RH article). In fact, the total a yes vote will authorize using current assessments comes to
$32 per month or $384 per year for the bond alone. In addition to a bond, voters are also being asked to
approve a Mill Levy Overide (MLO) of an additional 6.5 mills to raise another $11 million for a total
annual property tax increase authorization of $37.7 million.
The actual tax increase authorized for a $300,000 residential property within TSD, should voters
approve the Bond, MLO and interest rates go up in the future, will be $540 per year or $45 per month.
Because the total indebtedness being requested is $288 million. Therefore, TSD is asking voters to
approve a repayment plan that exceeds the current interest rates in anticipation of future events where
the debt costs can grow significantly.
Just as we learned in the 2008 housing crash, borrowers sometimes focused on their initial "step-in"
payment instead of the total obligation they are making for future payments. In Colorado the TABOR
(Tax Payer’s Bill of Rights) Notice controls what the district will be allowed to do following the election
if 3E passes. That notice states the “maximum annual repayment cost” is “up to $26,700,000 in any
fiscal year.”
Especially misleading are the total tax calculations for Loveland homeowners. Most newer housing
developments have a metro district tax imposed on them for 25 years in addition to the many other
special taxing districts. For example, a $330,000 home in West Loveland’s recently approved Lee
Farms subdivision could pay an annual property tax of $4,364 or $363.69 per month if the proposed
‘Thompson Reinvented’ and MLO are both approved and interest rates rise to allow the maximum
collection votes will be authorizing if the bond measure succeeds.
Another important element missing from the calculations provided by the advocates of taxing ballot
measures is the assessment rate of residential property. Due to an amendment to Colorado’s
constitution adopted by voters in 1983 called the Gallagher Amendment, commercial assessment rates
are fixed at 29% while the residential rates change periodically to reflect 45% of the total tax collected.
The rate has held at 7.98% for many years but the same organizations backing Thompson Reinvented
are working for a repeal of Gallagher which would dramatically increase residential property
assessments.
As an example, a modest increase to only 10% can increase the annual property tax of the same
$330,000 residence in Lee Farms from $4,364 annually or $363.69 monthly to $5,296.50 annually and
$441.38 monthly. Becuase the MLO is a fixed 6.5 Mills, the amount it costs you annually will rise if your
home increases in value.
Ironically, the Loveland City Council has been seeking ways to make housing in the city more
‘affordable’ by increasing subsidies to low-income families. Most of the proponents of government
subsidized housing on Loveland’s City Council are also endorsing the current school bond measure.
| School Bond Mill Levy: Bad Numbers Being Sold To Public |
| TO ALL REGISTERED VOTERS NOTICE OF ELECTION TO INCREASE TAXES/TO INCREASE DEBT THOMPSON SCHOOL DISTRICT NO. R2- J (LARIMER, WELD AND BOULDER COUNTIES, COLORADO) Local Election Office: 800 South Taft Avenue, Loveland, Colorado 80537 Telephone: (970) 613-5015 Election Date: Tuesday, November 8, 2016 Election Hours: 7:00 A.M. to 7:00 P.M. Ballot Title and Text: Ballot Issue 3E SHALL THOMPSON SCHOOL DISTRICT R2-J’S DEBT BE INCREASED $288 MILLION WITH A REPAYMENT COST OF $535.5 MILLION OR SUCH LESSER AMOUNT AS MAY BE NECESSARY, AND SHALL THOMPSON SCHOOL DISTRICT R2-J’S TAXES BE INCREASED $26.7 MILLION ANNUALLY OR SUCH LESSER AMOUNT AS MAY BE NECESSARY FOR THE PAYMENT OF SUCH DEBT, ALL FOR THE PURPOSE OF PROVIDING INFRASTRUCTURE FOR DISTRICT STUDENTS TO DEVELOP THE NECESSARY SKILLS TO COMPETE FOR THE JOBS OF THE FUTURE BY: UPGRADING SCHOOL BUILDING SAFETY, SECURITY AND FIRE ALARM SYSTEMS; EXTENDING THE USEFUL LIFE OF AGING SCHOOL BUILDINGS BY REPLACING, REPAIRING, AND UPGRADING HEATING, VENTILATION AND COOLING SYSTEMS AND MECHANICAL CONTROLS, PLUMBING, ROOFS, WINDOWS AND DOORS, REMOVING ASBESTOS AND MAKING BUILDING EXTERIOR IMPROVEMENTS; CONSTRUCTING, FURNISHING AND EQUIPPING A NEW HIGH SCHOOL AND A NEW K-8 SCHOOL, AND SCHOOL ADDITIONS AND FACILITIES, INCLUDING ADDITIONS TO BERTHOUD HIGH SCHOOL AND BERTHOUD ELEMENTARY SCHOOL AND THOMPSON VALLEY HIGH SCHOOL; RENOVATING AND REMODELING BILL REED MIDDLE SCHOOL AND THOMPSON VALLEY HIGH SCHOOL AND REMODELING THE EXISTING LOVELAND HIGH SCHOOL TO A K-8 SCHOOL; AND ALSO IMPROVING, CONSTRUCTING, EXPANDING, REPAIRING, REMODELING, EQUIPPING AND FURNISHING DISTRICT AND CHARTER SCHOOL BUILDINGS, ADDITIONS, FACILITIES AND GROUNDS; AND WITH SUCH DEBT TO MATURE, BE SUBJECT TO REDEMPTION, WITH OR WITHOUT PREMIUM, AND BE ISSUED, DATED AND SOLD AT, ABOVE OR BELOW PAR, AND AT SUCH TIME OR TIMES AND IN SUCH MANNER AND CONTAINING SUCH TERMS, NOT INCONSISTENT HEREWITH, AS THE BOARD OF EDUCATION MAY DETERMINE, WITH THE LIMITATION ON THE AMOUNT OF THE DISTRICT’S DEBT TO BE INCREASED UP TO 6% OF THE ACTUAL VALUE OF THE TAXABLE PROPERTY IN THE DISTRICT AS ALLOWED BY §22-42- 104(1)(b), C.R.S.; AND IN CONNECTION THEREWITH (I) TO INCREASE THE DISTRICT’S PROPERTY TAXES IN ANY YEAR AS STATED ABOVE IN AN AMOUNT SUFFICIENT TO PAY THE PRINCIPAL OF AND INTEREST ON SUCH DEBT WHEN DUE AND TO FUND ANY RESERVES FOR THE PAYMENT THEREOF, AND (II) TO COLLECT AND SPEND THE PROCEEDS OF SUCH DEBT AND THE REVENUES FROM SUCH TAXES AND THE SPECIFIC OWNERSHIP TAXES ATTRIBUTABLE THERETO AND ANY EARNINGS FROM THE INVESTMENT OF SUCH PROCEEDS AND REVENUES AS A VOTER APPROVED REVENUE AND SPENDING CHANGE WITHOUT LIMITATION BY THE REVENUE AND SPENDING LIMITS OF, AND WITHOUT AFFECTING THE DISTRICT’S ABILITY TO COLLECT AND SPEND ANY OTHER REVENUES OR FUNDS UNDER, ARTICLE X, SECTION 20 OF THE COLORADO CONSTITUTION OR ANY OTHER LAW? Fiscal Year Spending Information Year Fiscal Year Spending (FYS)* 2012-13 (Actual) $ 121,749,010 2013-14 (Actual) 126,140,635 2014-15 (Actual) 133,426,455 2015-16 (Actual) 143,515,283 2016-17 (Current Year Estimated) 145,788,254 Overall FYS percentage change through 5 years (2012-13 – 2016-17): 19.7% Overall FYS dollar change through 5 years (2012-13 – 2016-17): $24,039,244 _______________ *Does not include payments on bonded debt of $10,447,282 in fiscal year 2012-13; $10,515,797 in fiscal year 2013-14; $10,603,081 in fiscal year 2014-15; $10,697,803 in fiscal year 2015-16; and $10,823,055 in fiscal year 2016-17. Fiscal year spending without the tax increase in the ballot proposal is estimated to be up to $145,788,254 in the 2016-17 Fiscal Year, not including payment of bonded debt shown above and assuming no other tax increase is approved. The proposed maximum dollar tax increase in the ballot proposal is up to $26,700,000 in any Fiscal Year. The ballot proposal for bonded debt includes the following: Principal Amount: $288,000,000 Maximum Annual Repayment Cost: up to $26,700,000 in any fiscal year Maximum Total Repayment Cost: up to $535,500,000 (maximum principal and interest over the life of the debt) The current bonded debt for the District is as follows: Principal Balance: $89,085,000 Maximum Annual Repayment Cost: $11,707,500 Remaining Total Repayment Cost: $110,463 |