D.65 reduces bond ceiling
Superintendent Hardy Murphy originally requested a resolution authorizing up to $19.5 million in bonds over the next three years. | File photo
Updated: January 21, 2013 3:28PM
After a spirited debate, the District 65 School Board voted 4-2 Monday to reduce to $10 million the amount the district may issue in bonds without another public hearing.
Superintendent Hardy Murphy originally requested a resolution authorizing up to $19.5 million in bonds over the next three years. The resolution approved Monday granted the board authority but did not yet issue the bonds.
Board member Tracy Quattrocki and Board President Katie Bailey argued the amount authorized in the resolution could be cut to allow a future board to host a public hearing on the remaining bonds.
“If we just did $10 million, we could do another $10 million next year,” Bailey said. “What’s the harm? A future board will have to vote to issue the bonds anyway.”
Reducing the amount of authorization might limit the board’s ability to issue bonds at a time when interest rates are especially low, said board member Andrew Pigozzi, who voted with fellow board member Jerome Summers against the reduction.
“I don’t see harm, but to me it does not make much sense,” Pigozzi said. “(Authorization for $19.5 million) does not take away the authority of any future board to issue bonds. I don’t see why this matters. It makes things unnecessarily complicated.”
Creating a future bond resolution would not cost anything, but would require the board to conduct another public hearing, said Mary Brown, chief financial officer for the district.
Approving such a large amount without an immediate need for the issuance of such bonds may create a “psychological effect” causing the district to spend more freely, Quattrocki said.
“(Reducing the amount) seems like a reasonable thing to do,” she said. “We’re not planning on using it, and this provides an opportunity for the board and the community to talk about it later.”
“This is an absurd discussion,” Pigozzi shot back. “We could pick any amount. This is another absurd discussion I can’t believe we’re having.”
In his eight years on the board, this type of resolution is “not unusual at all,” Summers said.
“Neither this administration nor this board is know for a lack of frugality,” he said.
The board should determine its borrowing needs only as it moves forward to identify them, board member Eileen Buude said.
“I would match the amount more to foreseeable expenses,” Buude said. “I’m not hearing a strong opinion from Mary, just strong facts.”
The bonds authorized Monday are not yet targeted for any specific projects, Brown said. After a bond resolution, notice must be published 45 days before the bonds may be issued, she said.
In a memo to Murphy, Brown said the resolution was necessary “in order to move forward with future capital projects.”
Those projects are outlined in the district facility report, roof and masonry survey, technology plan, standardization report, life safety survey and infrastructure planning, she said.
“While there are tentative schedules for most of this work, these schedules do change to accommodate prioritized products,” Brown wrote.
The current terms of four of the board’s seven members expire in April. ~.