The Tempe Elementary School District No. 3 Capital Override Election Information
Tempe Elementary School District is seeking voter authorization for a capital override for an annual amount of $5,000,000 per year for seven years for a total of $35,000,000. This is a continuation of a capital override that was previously approved by the voters in November 2005.
What is a capital override?
A capital override is voter authorization to exceed the amount of capital budget allowed by the State of Arizona. The funds can only be used for capital needs which would be items such as textbooks, computers, furniture and equipment, and building improvements. A capital override is funded by local taxes and is limited to 10% of the District’s maintenance and operations budget.
Why is Tempe Elementary seeking this authorization?
The District currently has a capital override in place that was approved in November 2005 and will expire June 2013. The current capital override provided $5.1 million annually and is being used for technology, furniture, equipment and vehicles.
Why does the District need these funds?
Prior to 2001, bonds were the primary source of funds for capital needs. In 2001, the State passed the Students First Act and school districts were no longer able to use bond funds for capital needs. Instead, the state allocated what are know as soft capital funds to be used for textbooks, furniture, equipment and technology. Tempe Elementary is allocated approximately $2.6 million a year to fund all these capital needs. Unfortunately, due to the State economic situation, the legislature had to reduce this funding to help balance the State’s budget. In the last three years,
FY 2010 - $2.6 million allocation - $1.9 million cut (73%)
FY 2011 - $2.6 million allocation - $2.2 million cut (84%)
FY 2012 - $2.5 million allocation - $2.5 million cut (100%)
What is the difference between bonds and overrides?
Bonds are like mortgages – the District receives funds upfront and then pays annual principal and interest payments to the bondholders until the debt is paid. Property taxes are assessed to pay the annual debt payments which are typically over a 20 year period. Usually bond funds are used for buildings and building improvements.
Overrides are “pay-as-you-go” or cash basis. Property taxes collected are used to make purchases without issuing debt. The funds are usually used for items that have a shorter useful life.
What impact will this have on my taxes?
This is a continuation of the current capital override and is already part of the property tax rate. The estimated first year tax rate for the proposed budget override amount is $.3687 per $100 of secondary assessed valuation. A home currently valued at $80,000 is paying $30.08 a year in property taxes. If this override is renewed, a home valued at $80,000 will pay $29.49 a year in property taxes.
How will these funds be used?
The capital override funds will be used to purchase textbooks, instructional materials for classrooms, technology, furniture, equipment, and building improvements.
•Math, Reading, and Social Studies Textbooks and Instructional Materials - $5,350,000
The District is mandated to implement the new Arizona Common Core Standards. These standards are research-based and were developed to provide a consistent set of language arts and mathematics expectations to prepare all students for college and career options as well as ensure that students remain competitive in a global market. The capital override funds will be used to purchase the following:
o Math, Reading, Science and Social Studies textbook adoptions Including interactive online access
o 6-8 Honors curriculum and supporting materials
o PK-8 Library books including e-books with readers
o K-8 Math and science intervention materials for resource students
•Instructional Technology - $23,282,093
The Arizona Common Core Standards and related assessments also have technology requirements embedded throughout the curriculum and all students will need to be proficient to meet the standards. The current capital override provided the funds for the District to implement its technology plan throughout all schools and the continuation of the funds would allow the District to maintain and improve current classroom technologies as well as provide for increased student access. The capital override funds will be used to purchase the following:
o Classroom computers and mobile carts
o Interactive whiteboards
o School computer labs
o LED Projectors and document cameras
o Scanners, printers, copiers
o Servers and web filters
o Future network (e-rate) projects
o Major software maintenance
•Information Technology Systems - $5,284,907
The District will be able to continue to support its student information and assessment systems as well as its financial and operational systems. This includes the hardware, software and infrastructure to support these systems.
•Replacement of Outdated Equipment - $1,083,000
o Custodial equipment at all sites
o Special Needs assistive technology devices for students
o Transportation bus surveillance and application systems, garage tools and equipment
o Nutritional Services school ovens and quick chill unit
What happens if this does not get renewed?
If the override is not reauthorized, the District will have to make budget decisions that will have an impact on students and staff. Maintenance and operations funds will have to be used to fund the most critical capital items -- This means cuts to current staff and programs. Over 85% of maintenance and operations funds are used to pay for people (salaries and benefits) including teachers, principals, custodians, bus drivers, nurses etc.
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