There's no constraint to do that whereas the opposite would not be allowed because then we would be supplanting. So we're not allowed to supplant classroom site fund. So in other words, we can't use existing M expense and move it into classroom site fund. anytime we use classroom siphon it has to be supplemental it has to be for a pay increase. So we feel like this is the best judgment at this point in time. So based upon all of that that's how we are balancing the budget. So we are balanced risks and opportunities all of this is still very well known. Um the uh aggreate expenditure limit is still looming. the governor in the past three years now has put out, let's just go ahead and um uh pass that we can we can go over the AAL limit for this budget year since we're approving a budget that includes going over the AAL.
So, it's a pretty good bet that that would be proposed again. Again, we could see a greater loss of students. the legislature. The legislature looks like they will approve most of the governor's uh increases except that they're silent on Prop 123. So, we're still worried about Proposition 123. Uh the inflationary increase to the base could be less. We don't anticipate that because of this uh Republican budget that has been presented. Um minimum wage could be more than 3%. We don't know that. Um that's just an estimate. And then there could be significantly higher inflationary increases going into next year. But the opposite is true as well, which we saw this year. Our student count projection could be very conservative and we could only realize 800 or 900 student loss or maybe we do even better than that, which would increase our budget capacity as it did in the current year.
The legislature could approve greater increases in funding. um even if it's one time, we don't have any one-time increases in this budget at all, which would give us some more flexibility. And then costs, the uh ongoing cost could stabilize or decrease. And so again, our recommendation to all of you is to award a 2% pay increase for all employees uh for July 1, 2026 through June 30, 2027. And that action item is 9.05. And we are on it.
So that's all I have unless you have any questions for me or for Dr. Dr. McCord or any of us here. >> Thank you. >> Okay. >> Uh is there a motion for a 2% pay increase for fiscal year 2027? >> I move that we increase the the 2% increase pay increase for FY 2027. >> Okay. I will second that.
Uh, is there any discussion? >> Well, I I do want to say thank you to um our administration and our finance department for really working hard to make us a budget that has um proved to be pretty accurate about the challenges that we face and being able to still put together a 2% increase for our employees. I think that um that's quite an accomplishment. So, thank you. >> Agreed. Thank you, Miss Humphre. If there's no further discussion, I'll call for a vote. All those in favor? >> I Oh, sorry. Sorry. I guess you got to finish. >> No, I love the enthusiasm. >> You said it in favor. >> All those in favor of for Is that me? >> No, that's um that's for the next presentation. It's the bond council. It's >> got its own sound effect. >> Hi. Yeah, this is Jim Gil with Gus Rosenfeld.
>> Hey, hold tight for us. We're about to vote on something else. Thank you. >> I thought it was the two-minute warning for the meeting, you know. >> Yeah, Blake got real excited. >> All right. All those in favor for a 2% pay increase for fiscal year 2027, say I. >> I.
Any opposed? Thank you very much. 9.06. Consider, discuss, amend if desired, and if deemed advisable to adopt a resolution ordering and calling a special bond election to be held in and for the district and authorizing the associate superintendent of business and support operations to comply with certain sections of the Internal Revenue Code. This is this is all it's written all in caps. I don't know if I did I do I need to say it again and yell it. >> Okay. Dr. McCord. >> Thank you, Mr. President. Governing board members, uh before we we're asking you to uh give us authorization to go to uh put on the ballot for fall of 27 or 26 uh to go to our voters for approval of $136 million bond. Bonnie will give you a presentation. And I just want to note in this in the attachments for this specific agenda item, there is a resolution and it calls for 125 million.
That's a mistake. Uh and I noted that to all of you today. We have the proper documentation for that tonight that reflects the 136 million. And I'll turn it over to Miss Betts uh for presentation. >> Okay. Thank you, Dr. McCord. So um as you know uh Mr. James Gil from Gus Rosenfeld. He is our bond counsel. He is now online. Uh he is there uh to answer any potential questions you might have about the legal aspects of this bond question to go on the um ballot for the November 3rd, 2026 election. So um I he he too has a new granddaughter um just a couple of days after Dr. McCord's grandson was born. So, seems to be baby season. Maybe they'll enroll in maybe they'll enroll in Gilbert public schools in the future. >> Maybe. >> Sure. Okay. So, you have seen a lot of this before.
Um, I'm going to go through a lot of the the material that that you have already seen uh fairly quickly. There are going to be some sections that I think it would be really important for me to spend some time on some of the details. And again, please remember that um Mr. Gil is online and he'll be able to answer any legal questions you might have regarding this bond question. So um I I know that all of you are aware of the differences of general obligation bonds versus unrestricted capital, but I left those slides in there for purposes of having the full context um on the record. Uh then we're going to share the proposed November 2026 uh specific bond authorization request. Uh the site sale actually this occurred after the retreat um or the policy meeting on Monday. Um Dr. Robinson came up to me and said, you know, maybe we should take advantage of this election and put the the site sale on there since we have another vacant property.
we should be uh be proactive, not have to pay for another election to sell a piece of land, giving us more flexibility in the future. Um, I'm going to say this now, though, I'm going to say it again. Remember that just if it's approved by the taxpayer doesn't mean we're obligated to sell it. We have full discretion and that authorization never expires. It just gives us more flexibility if something should occur where we have an opportunity to to sell it at a at a good opport at a good a good price or with a um a good potential partner. Um right sizing Gilbert public schools. This is a conversation regarding the fiscal responsibility of our decision- making over time and then going into some bond request details for the November 2026 election. at that point in time. Um, I have, uh, Albert Dutch over here, too, to be able to answer any specific questions.
Uh, thank you, Miss Murray, for for your questions. It gave me some context, and some of those I'll I'll make sure I'm I'm addressing uh in this presentation. Um, but Albert will be able to uh bring in some more some more details. Uh, then the tax rate impact, election timeline, and cost, and then just future considerations. So general obligation bonds versus unrestricted capital. As you know, a go bond is authorized by the taxpayer. The debt service is paid for by the taxpayer. We in the finance office uh set the tax rate for that secondary tax rate to get that debt service uh that debt service revenue annually. Of course, unrestricted capital is awarded by the legislature um every year. And there are more restrictions on the use of general obligation bonds than there are in unrestricted capital. Um, and then this is just some details about the rules regarding general obligation bonds.
If you have any specific questions on that, um, Mr. Gil is perfectly able to answer those. Uh, so bond authorization for $136 million and the site sale. These are the details that will be included in the bond pamphlet. um that goes out sent out I think in the September time frame. These are our um requests on a line item basis. So critical facility upgrades and replacements $65 million career and technical education as well as extracurricular spaces $20 million safety and security elementary junior high secure entryways fencing ADA requirements electronic access. I don't know if you know, but we have added electronic access to several of our buildings to eliminate the need for keys. Um, so we wanted to make sure that that was on there as a as a potential depending upon how long the resources last us. And then of course safety and fire code related items.
Technology infrastructure, I'll bring um Mr. John Castellano up here to go through the details of his requests. and then uh student transportation, buses, vans, and equipment uh to request $6 million. So that's where we arrive at the full $136 million. So the parcel description, this would be Oh, the other thing I wanted to point out, so the um county elections department has decided that for school districts, they are going to give them a proposition number now. So we actually have been given two proposition numbers. So our bond will be proposition 422 and our site sale will be proposition number 423. It will appear on the ballot in that way and it does provide some ease associated with our um political action committee and campaigning and that sort of thing. Uh an easy way to identify our particular initiative um in comparison to others that might be on the ballot.
So the partial description uh site referred to as Pioneer Elementary located at 1535 Greenfield Road. It's approximately 11.86 acres. We are obligated to provide a legal description through the assessor's parial number. That will be determined that will be required. A title search will be required and title information will have to be um gathered to be included in the bond pamphlet. And then remember again, as I said before, voter approval is required for the sale of the land and property, but the authority to sell never expires and the governing board is not obligated to sell any property after voter approval. Wanted to make sure that that was clear to everyone. This request only allows GPS an opportunity to qu to act quickly if an opportunity arises. So right sizing Gilbert public schools. So our average daily membership history from 2018 to 2027 projected is displayed here.
So as of fiscal year 2026 we have lost a little bit over 4,000 students. But during that time we closed Houston Elementary and we've moved Neie into the Houston Elementary campus. Two years later, we were able to sell the Neely campus to the town of Gilbert. And then now, fast forward to this current year, we all uh you all approved the closure of Pioneer Elementary, and all of those um students and staff have been uh have been notified of where the where their new boundaries are to include transportation as as needed.
Are there any questions about any of that? Okay. And then in addition, as we shared tonight, as we're expecting a loss of students, we know that we're not going to need as many staff. So, we have done that since the 2018 and 2019 school year. And you can see the staffing savings over time. So over these these um gosh eight years now, we have uh we have saved 20.3 million in ongoing um resources and largely that money has gone right back into salary increases to the existing staff. School closures avoided capital cost and sale proceeds. So Neie site total avoided cost was 2.5 million. Pioneer site was 1.9 million. So a total of 4.4 million in avoided capital costs associated with renovating our buildings. And then the Neil the sale of the Neely site resulted in $6.85 million in school plant proceeds of which we still have about $4 million left.
and then during November of 2024. So, we're being kind of consistent when opportunities arise, we put site sales on an election um so that it gives us that future flexibility. If opportunities arise, we can we can act on it quickly. So, the other question is why is unrestricted capital not enough? So the conversation is really on looking for a level playing field for all public education students whether being educated in a district, a charter school or receiving an ESA and empowerment scholarship account from the state of Arizona. So should all public school students receive the same capital funding on a per student basis is really the question. So, I would propose that by uh by approving a bond ask in November, it would allow us to get that level playing field in comparison to our charter school and our ESA peers for our students. So, here has been our GPS unrestricted capital funding history.
Note that from 2015 to 2021, the statutory formula was actually reduced due to trying to balance the budget. During that same period, however, charter school additional assistance was not changed and did increase by a certain percentage every year. But over those seven years, a total of $73 million of unrestricted capital proceeds was not provided to Gilbert Public Schools. >> State did not provide that to us. It wasn't that we reduced that funding. It was that the state legislature that >> our funding was reduced accordingly. Yes. >> Okay. >> So that which underse capital was adjusted down by the state legislature to the total aggregate amount of $73 million over that time frame. Yes, that's correct. >> So here's the funding comparison. Um so here you see on the left the state formula funding with the 15% override for Gilbert public schools as the example. This is specific to the current year.
On the right is charter school and ESA state formula funding. And all of the money on the right for charter schools and ESAs is 100% funded by the state general fund. As you know, for school districts, we are funded partially by local taxpayers through the qualifying tax rate along with general fund monies. So looking at elementary funding and high school funding and comparing them, Gilbert public schools is funded less than charters and ESAs by 271.7 $271.72 per student and $488.20 less per student for high school students even with the 15% override. So, I'd propose that the state legislature understands the need that that schools have to have capital funding available to them in order to maintain their buildings. But state statute allows for school districts to go out and request bond authority to help them meet that need. Whereas charter schools do not have the ability to request bonds because they do not have a boundary.
So there's a reason why the legislature funded charter schools at a higher level for capital than they do for school districts. I wanted to just make that clear. But again, by having the bond available to us, it helps make that that playing field level so that all students, regardless of how they're educated in the state of Arizona, they have the same amount of resources. So, as an example, if Gilbert public schools had the capital funding available to them for each of our elementary and high school students as our charter school students and ESA students, Gilbert public schools would have about $50 million more a year, which would negate the re the need for a bond. So, that's the that's the takeaway from this particular graph. So now we're going to go in the details regarding okay why are we requesting $136 million. So as you know uh 3 years ago we entered into a study to determine the facility status I guess the um what what is the condition of all of our facilities as of the spring of 2023.