Will the amount you pay go up? This plan hopes so. Will your tax RATE go up? Depends… Dallas Regional Chamber did a survey of likely voters, and the results were the bond might pass if DISD doesn’t raise tax rates. So, they’ve been trying to figure out how work within that.
The first plan – the one presented to the Board – would only have worked if average property values rose over 30% in the next five years. You can read about the old plan here.
That repayment plan is out, so what’s the new plan? Brace yourself…
Yes, you read that right. Balloon payments. Don’t solve it, just kick the can down the road! (Because that’s working so well in Washington?!) Polite words escape me, so here’s a quote from a letter to the Editor at the DMN that explains the whole scheme brilliantly:
A salesman says you can trade in your Ford Focus for a new Lexus, but your payments will not go up. You want to know: What’s the catch? Dallas ISD has $2.7 billion in debt and they’re asking voters to approve another $1.6 billion — with no tax increase. What’s the catch?
The catch is a balloon financing structure that postpones $800 million in payments to the end of the term. The crisis will come earlier, in six to eight years, when it’s time to repair another set of crumbling schools.
Maximizing debt today leaves few options for future needs, all guaranteed to increase taxes significantly.
There are ways to get to an affordable bond program. First, assess where boundary lines can be moved to shift students from overcrowded schools to underutilized schools. The plan calls for $660 million for new schools and additional classrooms for an essentially flat student population. Second, rethink some of the expensive program-driven changes, which will cost another $100 million.
Demand a better plan. A vote against the bond is not saying never, it just says “not this plan.” So do it for the kids, vote no — the students and your wallet will thank you.
Here’s a nice picture to go with all of that, which is based on this DISD document. Look at the date the balloon bill comes due… the little ones we are building the Pre-K classrooms for are going to be the ones stuck with half the bill (even if you stretch the debt out farther, that’s still true).
Just to put things in perspective, here’s what our debt looks like compared to the other top 19 ISDs in Texas.