Jefferson City's schools are "completely out of space" and it's time to start looking for ways to expand facilities to meet the demands of growing class sizes, the district's chief financial officer told the Board of Education last week.
At a work session Monday, President John Ruth asked members to start the groundwork it will take to construct more educational space. Specifically, he asked his colleagues to familiarize themselves with the work the Long Range Facilities Planning Committee (LRFPC) completed last winter.
"What I propose this evening is we not necessarily take a position on the issues yet. But I challenge all of you to get into those binders and start to form an opinion. At the same time, keep an open mind and be ready to discuss, deliberate and debate," Ruth told his colleagues.
Jason Hoffman, district CFO, said, "One of the biggest things we need to understand, and our community needs to understand, is we're completely out of space."
Hoffman said the last bond issue was passed in 2007 in order to expand all of the elementary schools to accommodate full-day kindergarten, to update libraries and remove trailers. At the time that bond issue passed, Jefferson City was experiencing declining enrollment. Between 1999 and 2007, enrollment dwindled by 279 students and class sizes averaged about 640 students.
"We weren't anticipating growth," Hoffman said.
But things changed in the fall of 2009 when 730 kindergartners showed up for school. Pioneer Trail Elementary School had just opened. Full-day kindergarten had launched and the district's promised projects were complete.
"It caught us off guard," Hoffman said.
Over the last seven years, kindergarten class sizes have averaged 757 students. The largest class of 821 students in 2010 is particularly perplexing. Demographers are uncertain why the growth happened, because live-birth data doesn't correlate and no large new employers moved to town.
"The kindergartners from 2009-10 are now in the fifth grade," Hoffman said. "All of the smaller classes are now in the middle and high schools."
Hoffman uses a method called "cohort survival projection" to estimate future enrollment. At the moment, the district's elementary enrollment is as large as it will get. The schools are full of large elementary classes, but they are not getting bigger as they move on, he said.
"If trends hold true, elementary attendance should be maxed out right now," Hoffman said.
He noted those large classes are going to "cause stress" at the district's relatively-modern middle schools, but the real problem will arise once they being to enter high school.
If his method is accurate, projections indicate nearly 790 ninth-graders will be enrolled at Simonsen 9th Grade Center in the year 2019-20. Occupied in 1938, the building is designed to handle 632 students.
The building has some problems. Architects characterized the building as "borderline" in several areas, including: educational adequacy, safety, and structural and mechanical soundness.
"We're going to have 800 students at Simonsen and that's only four years away," Hoffman said. "The concern is, once we decide to do something, it's going to take us several years to" build new schools.
He noted the district is already experiencing "pressure pockets," places where overcrowding is creating tension. Although the perception of overcrowding is greatest at East Elementary, three other schools - Belair, Lawson and Pioneer Trail - also appear to be over capacity, according to a comparison of January class-size data and capacity estimates published in a school facility appraisal summary.
Pioneer Trail, for example, currently has about 582 students in a building designed for 538.
Board member Pam Murray - who also served on the long-range facility planning committee - noted Hoffman's data "ties right into" the group's recommendations.
In its list of current needs, the committee recommended spending $13.8 million to build a new elementary school on the city's east side for 400 students and $5.5 million to add capacity for 220 more at Callaway Hills Elementary School. The existing East Elementary School - which is slated to be refurbished this summer - would remain in service, but with fewer pupils.
Hoffman said he is concerned about timing. He noted recent survey data indicates the public prefers to vote on bond issues for elementary and high school projects separately.
"Can we wait two Aprils?" he asked.
April is the district's preferred election month. It's when voters decide school board seats, an election expense of $40,000. To place ballot initiatives at other times in the year means shifting more money away from students.
In January, the board chose not to move forward with a request to raise the district's tax levy. They could again do so in April 2016 or August 2016, elections where passage for tax increases are permitted with four-sevenths of the vote.
State law limits how often municipalities and school boards can approach voters with tax requests. An odd-number year, like 2015, offers few opportunities for governing entities to pass their requests with four-sevenths (57 percent) of the votes cast, an easier bar to reach, compared with two-thirds (66 percent).
"We're very restricted in the kind of debt we can enter into," Hoffman noted. "The most common for (school) construction are general obligation bonds."
Although general obligation bonds traditionally have been the preferred method to raise taxes - they typically offer better interest rates - they also are limited. A plank in the Missouri Constitution caps the amount of borrowing a school district can enter into at 15 percent of its total assessed valuation.
That's not a problem for Jefferson City, where bonding capacity is more than ample. Jefferson City's assessed valuation is about $1.2 billion; 15 percent of that is $180 million.
"We have $33.5 million in outstanding general obligation bonds. This is not an issue for us," Hoffman said.
Lease-purchase agreements are also a viable option now, Hoffman said, since the Legislature made changes that reduce red tape, including eliminating the requirement that a nonprofit, third party serve as the leasor.
He noted voters can pass a lease-purchase - which he compared to a more-complicated version of a home mortgage - with simple majorities. They can be placed on any ballot.
"Generally you pay a marginally higher interest rate over a general obligation bond," he said. "But you could argue: "Will interest rates go up between now and next April?'"
Lease-purchase loans are paid out of the district's operating levy, not the debt-service levy. Twenty-year loans are common, and he noted a portion of the operating levy increase may sunset when loan payments are complete.
After board members asked a series of questions, Ruth brought the conversation full circle. He said the goal was to bring information to the board as they consider the committee's recommendations.
He asked rhetorically if the board should do bond issues for multiple projects together or plan them in a strategic order. The board also chatted about the viability of capital projects if elementary school boundary changes become a part of the debate.
Ruth concluded he wants to "have a deliberate and open debate about what makes sense."