001And tonight's meeting, we're going to ask Officer Tim to come to the front to lead us in the pledge of allegiance. Thank you. >> All right, we will lead off the U meeting with open forum. So bear with me while I read this. Welcome to all those who are here for the open forum. Our goal is to allow a time for individuals to address the board in an orderly, efficient, and dignified manner. The board will enforce a threeminut limit per speaker for up to 30 minutes. If you have handouts, they can be shared with our campus officer for distribution. At the conclusion, the board will close the forum and proceed with its agenda items for the evening. We appreciate your presence as we value the opinions and concerns of our patrons. If you're unable to
002address the board during open forum, you may address the board by email. I have a few reminders about the open forum that will help our speakers have a constructive and positive experience when discussing items with the board. When making reports, please be civil and use respectful language. Please limit discussion to the relevant business of the board tonight. Discussion of matters related to a specific student or employee are not allowed. Instead, comments should be submitted to the superintendent in writing. Please remember to limit your comments to three minutes and avoid repeating the concerns of a previous speaker. Please remain in the designated visitor area and refrain from approaching the dis where the board of education is seated. If you have questions that need a response, someone will follow up with you at a later time. So,
003on behalf of the board, I welcome you and appreciate your interest in Blue Valley as we provide the very best education to our students. When your name is called, introduce yourself before beginning your remarks. And as a reminder, we ask that all remarks are limited to three minutes. Let's get started. Steve Roberts. Thank you, Mr. President. I represent citizens, I guess, uh and no matter how local politics go uh this fall, popularity contest being what they are, I'm going to advocate that we pay our teachers not only more money, but that we pay good teachers good money and very good teachers very good salaries and excellent teachers excellent pay. And the reason this is an issue, and I apologize, I I've not looked at your agenda, so hopefully I'm not taking away from things you're
004concentrating on this evening, but in a very general sense, as as I do ride share and talk about these issues with a wide variety of people, almost everyone agrees that teachers are underpaid. I think uh the average citizen doesn't realize that public school teachers generally make a little more than private school teachers on average. I don't think most people know that. But I think uh more than 90% of our fellow citizens agree that teachers could do much better with better compensation packages. Where we get into trouble, I think, is treating all teachers the same and telling our teachers that uh well, you only have three or four years experience, so in order to get to the top of the pay scale, you you really need to work another 25 years. I think here in Blue
005Valley, we have the opportunity to get past that. And from my remarks uh at the last meeting, I I left you with the idea that uh we should have uh multiple measures for our teachers. Because when I brought up this sort of issue when I was on the state board, the the push back was always something along the lines of what are you going to do, Mr. Roberts? Base teacher pay on test scores? No, you don't base teacher pay on test scores. That can be one of the measures, but you want to have multiple measures. I think you have to have both administrative review and peer review. I think that's very important. I think peer review can be terrific, especially in a district like Blue Valley where we have so many good teachers. Uh peer
006review helps knock those rough corners off the the edges of bad habits and things like that. But you also want to listen to the parents. And here's where it starts getting thick. as you as you have teachers listening to the feedback from parents, you have to have teachers who are not merely, you know, clerks doing what they're told, but they have to have some modicum of managerial acumen so they can go like this to those parents that don't have the sense God gave a goose because some of our parents, sorry to say, don't have the sense God gave a goose. And so, you need you need teachers who uh can say, "We've got this. Appreciate your feedback, but we've got this." But I think the very best uh way to determine which of our teachers
007deserve more in their compensation packages is to ask the students, particularly in secondary school, ask the students. They'll tell you who the good teachers are. So, no matter how the chips fall uh this fall, I hope to uh work with you and make some of these things happen. Appreciate your time. >> Thank you, Mr. Roberts. Appreciate you uh taking time to come to share your thoughts with us. Now, Time to call the meeting to order. Um, want to welcome you to the monthly business meeting of the Blue Valley Board of Education. It's a time when the board publicly conducts the business of governing the school district. And while these meetings are open to all, public interaction is limited to individuals who have signed up for the open forum. So, we kindly ask all attendees to
008contribute to a positive atmosphere by conducting themselves with the quorum. Please engage in civil and polite behavior toward one another. It's crucial that everyone everyone present extends courtesy to both the schoolboard members and those presenting by listening attentively. Please refrain from making comments or sounds and fostering an environment of respect. Thank you for your understanding and cooperation and making this a productive meeting for all. With that, I call the meeting to order and look for a motion to approve the regular board of education meeting agenda. I move that the board of education approve the August 11th, 2025 regular board of education meeting agenda as published. >> Second. >> Moved by Gina, seconded by Jody. All in favor, please signify by raising a hand or saying I. Jim, did you vote? Okay, it passes unanimously. So,
009now we're ready for the consent agenda. And uh as we look at the consent agenda, I need a motion to approve it. I move that the board of education approved the August 11th, 2025 regular board of education meeting consent agenda as published with minor edits deemed necessary by legal counsel. >> Second. >> Moved by Gina, seconded by Clay. All in favor raise your hand. It passes unanimously. So now we need some reports and discussion items such as the board of education reports finance and operations. Jeremy Jeremy McFaden, CFO. Um the finance and operations committee met on August 7th in the commons room. Um topics discussed at the FNO committee meeting. Uh Jake Sbodnik, executive director of operations, welcome committee members and presented the topic proposed topics for 2526. Committee members were asked if there were
010any other topics they would like to discuss outside the typical cadence of annual reports. Committee members mentioned adding updates from other advisory committees, updates on bond projects, updates on Blue Valley enrollment trends, updates on legislative agenda topics, and school finance 101. I presented the proposed fisc year 2526 budget. Uh required budget publication notices were reviewed with the committee highlighting the various mill levies proposed for board consideration. budget hearings and final board approval. The budget will occur in September. Jason Gillum, director of business operations, presented the purchasing memo as shown below. The next meeting will be September 4th in the comments room. >> Anyone have any questions or discussion? Um Jeremy, I just want to um throw in that that that was a we've got a good group of people for our um committee this year.
011You did a great job going through some of the um details of the revenue neutral form, um highlights of the budget, getting into some of the weeds to help explain to some of the members. And I think that's where the finance 101 could come in at a future time. So, I want to thank you for that and just acknowledge that uh we pretty in depth in the committee and they had some really good questions and feedback. So, >> Jeremy, thank you very much. We turn over to the superintendent report from Dr. Chapman. >> Good evening, board members and Uh this this year we welcomed 172 new teachers uh to our uh district and that number is down a little bit which we is a good thing because that indicates that our recruitment and retention efforts
012have really paid off and it was a wonderful opportunity to welcome them last week and they have been busy in their classrooms um getting ready for the school Today on Friday, um we had the rally in the valley. Well, half of it. Um and it was a lot of fun in the morning. Um where we had lights and cameras and action and power. And in the afternoon, moments before we were getting ready to kick off, uh we had a a power outage in the area. And I was going to um accuse somebody of cutting the power, but um alas it ended up being a an area outage. Um so unfortunately we weren't able to have the afternoon event, but it was a lot of fun and our students were definitely the highlight. So, um, hopefully
013we'll get to see our afternoon students a little bit more and we'll be sending out a summary for the staff because there's a lot of really great information in there also celebrating milestones for our our teaching staff and our regular our uh classified staff as well. So, we want to honor those folks. the very best day of the entire year is um just two days away. Finally, the first day of school and um tomorrow we'll be welcoming sixth and ninth grade students and any new students to the district um as well. So um I know there's a lot of nerves um in the households going on this week and um we're really excited about the first day of school finally being here. We had 169 students who earned the seal of biiteracy which is a
014huge accomplishment and 31 of those students also earned a gold seal which demonstrates their proficiency in a second language. So this is something we should be definitely celebrating. We also have Blue Valley Northwest um student Nova Rule and she was one out of 211 student um ambassadors to the National Student Leadership Summit and she has already reached out to our other high schools. She's the 6A representative. she's already reached out to the other high schools wanting to um talk with students and hear more from them so that she can well represent um our Blue Valley community through the Kansas High School Association and the National Federation. So that was really great. Um I presented at the Leewood Chamber of Commerce annual breakfast last week. So that was um enjoyable. It was also fun to hear
015um what's going on in Shauny Mission School District as well as University of St. Mary and um Sister Steele is um retiring at the end of the school year. So I was sad to learn about that. She's been a part of St. Mary's for a really long time. Um, Chance Wrinkle, graduate of Blue Valley High School, um, is a, uh, qualified for the 2025 US Amateur Golf Championship. If you happen to be in a scramble with him, you definitely want him on your team. Chances are you're going to win. Um, but it's exciting to see our alumni doing so well. And um also celebrating again Jack Punswick, graduate of Blue Valley West, recently named the 25 Hope Gala Hero honore by Braden's Hope for Childhood Cancer. So it's exciting to see um how inspiring um
016Jack has been to our community and um really across our country. So it's very exciting. And that concludes the superintendent's report and um I'll be happy to report next month after we've had a few weeks of school under our belt. >> Great. Thank you very much, Dr. Chapman. Um have some action items tonight. First is to approve the 2025 26 related service professionals uh negotiated agreement between the board of education and blue valley national education association related service professionals. Dr. Do you care to tell us a little bit about it? >> Uh, we conducted our negotiations on the 5th of August with our Kansas National Education Association related service professionals. Uh, the vote came in this morning. We have 100% of those who voted um agreeing uh to this negotiations. So before you is action
017item to approve this agreement. >> Uh last year was 100% by this group as well. They have 107 members. So 100% last year, 100% this year voted yes. Any other questions? So I need a motion to approve it. Considering 100% approval by the association members, I move that the board of education approve the 2526 related service professionals negotiated agreement. >> Second. >> Moved by Gina, seconded by Jody. All in favor, raise your hand. >> It passes unanimously. Our second uh action item is to approve the 2526 professional employees negotiated agreement between the board of education and the Blue Valley Ed Association. Dr. Pens, >> yes, we met in late July uh with our teachers association, the Blue Valley Ed Association. Um and this morning we closed voting. 97.5% of our votes were yes from the
018teachers association. So fantastic partnership. Um over 1,069 uh teachers voted in this year's agreement and like I said 97.5% were in favor of this agreement. >> Any other questions or comments on this? It's a 4% increase. Is that correct? >> 4% in every cell and step movement for our teachers. >> Okay. >> And then includes the in Can you talk about the insurance? >> Yes. Also included uh would be um district supported u individual health insurance three plans at 0% increase and those were zero cost. Uh we do have other plans um that individuals may select that included an increase. >> Any other questions or comments? >> Um Dr. Punick if if you know the answer to this question. Um as you know we routinely underfunded with our excess special ed costs and expenses. >>
019Um I think last year was to the tune of 16 million. Does that sound right? >> Okay. >> Um just hypothetically if we were to actually receive that special ed funding because we still pay for those special ed funds out of general funds. Correct. >> Correct. If we were to receive those funds, what would be the um and and if we were to hypothetically put all those funds toward teacher salaries, what would be the effect? What would be be able to increase our teacher salaries by? >> Definitely a double-digit increase somewhere over 12% would be able to be infused into the salary schedule. >> Okay. So because of the lack of statutory funding for excess special ed funding um we are not able to do that and but we are able to do a 4%
020correct >> yeah with given those parameters. Yes. >> Any other questions or comments hearing? None. I need a motion to approve the 2025 26 there's a lot of 20s professional employee negotiated agreement. >> I move that the board of education approve the 2025 2026 professional employee negotiated agreement. >> Second. >> Moved by Jody, second by Clay. All in favor raise your hand. It passes unanimously. Next is to approve the classified compensation for the 2526 school year. Back to you. >> All right. Uh for this year's um administrative um recommendation, we see classified compensation increasing at 4% for our classified staff members. Um we have over 1500 classified staff members who are not included in the negotiated agreements that you've just approved. And so those individuals would recommend a 4% increase for them as well. questions
021or comments? >> This is more of a general question and probably applies across each of these categories of compensation arrangements. Um, but I was thinking of it when you mentioned the step increases in the um in the negotiated contract is that each let's call it box on the salary schedule is increased by 4%. But depending on the tenure and or education of the staff member, their increase may be more than 4% because they may be moving up a step or maybe, you know, obtaining a a subsequent degree or something to that effect. Correct? So, additional degrees moving to the right of the salary schedule would mean additional increases. For those who are returning, they would have a step for the Now it's at 179 new hires. Um they would not be stepping down. And then
022there are still some areas of the seller schedule that are frozen in terms of there's no differences in the steps from say 15 to 35. Those individuals it would be 4% but moving down doesn't necessarily equate to an additional increase. So um if we approve a 4% increase maybe this is a Jeremy question but maybe you know um what's the actual compensate what's called the aggregate compensation which is both salary and benefits and whatever your loaded costs are >> what does that increase year-over-year >> I would have to give you I would have to spend some time factoring that to pull in both lateral horizontal movement as well as the insurance increase. The overall insurance increase was north of 15%. And the district utilized reserves and policy changes to cover about 10% of that. >>
023Okay. So, you don't have to go through that work, you know, for quite immediately, but that'd be a good piece of information to have. And then maybe historically, maybe the next time we maybe like at next workshop you could just report in on what historically we approve an x% but the because we're have an aging or maybe we have a young you know a greening of a workforce that's the impact. Um, so that really relates my question to those employees who are under a negotiated contract with that kind of step structure. >> Um, what does it look like for um classified staff as well as for administrative staff? >> Great. So both classified staff room. You have individuals who are on table. So they are aligned with a schedule and they have step movement within
024those schedules that are equal across every one of the schedules. Um those individuals then are really based off of what the table has provided in terms of step down and what that dollar amount is based also on the job type. Also in classified staff you have offt individuals who are not equated to any of the steps themselves, but they are salaried off table. And so you have those individuals that will be applying 4% to if this is approved. Okay. And then h how how about administrative staff? Is there kind of a normal annual like you've been here 12 years as a principal, now you're your 13th year, you have a natural annual step up and then there's a also a compensation increase or you kind of come in and you just get whatever the annual
025increase is. >> Good question. So, very similar to off table classified staff members. Administrators come in at a set salary for that specific position that they're in and then the annual increases that you as a board select go to those individuals and then they are moving up the um they could move in the salaries as well. >> They could move like up a step type. There's no steps, but if you were to provide a 4% increase, their salaries would go up a 4% increase as well. >> Okay. But I think the import the sorry the the point I'm trying to just understand to make sure I get is that um the those employees on a sort of step schedule. >> Um generally the trajectory through their career is to to get some sort of natural
026increase because they're moving up a step plus whatever additional percentage increases might be approved. that >> in the most simplest form. Yes. However, there are times historically that individuals um by board approval did not move a step and so there wasn't a progression. They were frozen on the step that they were currently at. And we've had that I think a number of four times in the last two decades. >> Okay. And that's kind of economic pressures that that drive that or something else >> at the time. Yes. So they were if you go back and look at from a historical standpoint, not year a step was granted. Some years there was a freeze and a one-time payment. Sometime there was money put into the salary schedule. So what we saw this year, what we would
027say is this is what we hope for and this would be a typical cadence of money going in and staff. >> So um I'm kind of pre skipping ahead, but I figure I'll get my questions all out of the way on administrative administrator compensation. Um Is there natural ways other than an annual renewal or review by the board and approval of certain compensation schedule for an administrative principal or somebody else in the in this class of employees to achieve a compensation increase through education, through extraordinary performance, years of service? What what what triggers uh that besides just our annual review in a percentage increase. >> Great. So that's a really good question. There is a range that our administrators are in by their position type. They come in at that range based on education, the
028experience that they bring, um the needs that they may have within that building. And so at that point that they're initially placed, that's what's in place. We do have a situation in which an individual who comes in who's licensed for the position but later goes on to receive a doctorate or an earned doctorate. Those individuals are provided additional compensation for that graduate level degree, terminal degree. And then there are times in which an individual um is asked to do a different position than what they're currently in and the superintendent has latitude to be able to provide additional compensation for that individual if they're being asked to move to a different location. >> So you have some discretion. >> Thank you. >> But but not not a step table like what you have agreements. >> Any
029other questions? >> Hearing none. I need a motion to approve the uh overall increase of 4% for classified wage schedules. I move that the board of education approve the overall increase of 4% to the classified wage schedules for the academic school year. Second moved by Jim, seconded by Clay. All in favor raise their hand. It passes unanimously. Last one for you, I think. Eric, maybe. Yeah. Approve the administrator compensation for the 2526 school year. All right. Before you for um consideration is a 4% increase for administrative compensation for the 2526 school year. Uh to follow in line with our other three approvals. >> Any discussion or questions? >> I'm sorry. I just have one more question. >> I know. Sorry. Can you tell can you just uh elucidate the kind of where you where you
030think our administrators stand relative to other large school districts in Kansas, Johnson County, Kansas City, Missouri, Kansas City, Kansas? No, >> I think that they're following very similar ways that we have for our teachers in which right now we have the highest starting teacher salary in the county. We also have the highest ending salary in the county for our teachers and I believe that we are very much in line with that with our administrative staff as well. >> Thank you. Any other questions or statements? >> Oh, I need a motion to approve it. >> I move that the board of education approve the overall increase of 4% for administrators for the 202526 academic school year. Moved by Jim, seconded by Jody. All in favor raise their hand. Unanimous. >> Okay. Thank you. Um I know
031with all of our teachers and our related service providers and their positive uh votes. Uh that speaks with unanimous votes from the board of education as well to our fantastic partnership. So thank you >> and thank you very much for your work on it. >> Hey, before you before you leave, can I ask you a quick question? >> Yes. So, um, with with the new onboarding, are we fully staffed? >> Um, actually, we had a section pop today at Leewood. >> Um, and so we are, um, hoping to bring that person on tomorrow morning. >> So, yes. >> Okay, perfect. Thank you. >> Absolutely. And tomorrow, we may have one more needed, but as of right now, we just have one, and we believe that we're going to have that filled by noon tomorrow. >>
032Nice. I appreciate all the work. >> Well, thank you. Great. >> Fantastic. So now we need to approve the publication to exceed revenue neutral tax rate for 2526 budget. Back to you Jeremy. Uh board members, Dr. Chapman, um we have two notices uh for your consideration for approval tonight. Um the first uh notice is the notice to taxpayers of our revenue neutral right hearing in the month of September uh where they have an opportunity to address the board with any concerns that they have. Um this notice uh projected on the screen, it's a notice that all school districts in Kansas complete. It looks the same regardless of school district that you're in, except for the amounts obviously in the days and times. At the top of the notice, you'll see that we identify the 8th
033of September at 5 uh30 p.m. uh here at district office uh for that hearing. So when we get to the next board meeting, that is the first thing that we will do at the September 8th board meeting is have the revenue neutral right hearing and that's following recommendations from KSD in order to be compliant with uh state statute regarding RNR. So the top is the publication uh description of time place. Uh the middle of the document we'll we'll get into this briefly, but I want to kind of hop to the end and maybe work from the bottom up. So at the very bottom of this notice, the very last line, you'll see the total taxes levied excluding general fund. The reason we exclude the general fund mill levy is there is statute uh passed in
034Topeka that sets the 20 mills that helps the state of Kansas fund the school finance formula. So you are not able as a governing body to make any adjustments to the 20 mills that is that is set. So this bottom line is really the mill levies that are under our control. So as we work our way from left to right, the left hand column numbers show the actual taxes levied from a year ago 2425 along with the actual tax rate. So at the very bottom you'll see 153.7 million approximately with a mill rate of 33.596. So again, one line above would show the uh 20 mills included, but the bottom line is the ones that that obviously are in front of you for consideration. The middle columns show if the revenue neutral taxes remained the
035same based off of districtwide assessed valuation, what would the new mill rate be in order to attain the achieve the same uh revenue neutral taxes of 153.7 million. and that mill rate uh kind of bottom right 32.318 is the revenue neutral rate. Continuing on to the far right you'll see the 2526 proposed taxes to be levied. We are proposing 159.7 million with a proposed tax rate which is essentially flat from prior year of 33.594. So, I'll pause here to see if you have any comments or questions on kind of what we've reviewed so far. >> So, Jeremy Roi, who said they assessed uh valuation, >> that's Johnson County, and we do have a small sliver of Miami County, but statute requires Johnson County by June 15th to notify Blue Valley of the estimated assessed valuation
036that we use in the creation of this uh budget notice. The actual valuation will not be finalized until November 1st. So right now we're working with estimates. They generally are pretty close to what is actually finalized in November. >> So So we set we we've kept the uh tax rate the same as last year, but it's Johnson County that has changed or increased the assessed valuation, which results in additional revenue of the 159. is the 153 million. >> Right? So, step one is they provide what the valuation is. Then we align that with our budget goals certainly around compensation um and then set a tax rate based off of that valuation. So if we uh kept the original valuation and the reduced tax rate, what impact would the $6 million roughly have on the school
037if we >> remained revenue neutral? Um that additional $6 million we would have to lean into our operating reserves um to essentially get through the 2526 fiscal year. Um so that would be um a pretty aggressive um lean into our reserves uh because with the 4% we're already um projecting to utilize some reserves for 2526. So remaining revenue neutral would essentially double down on that. So that's where we're proposing a flat mill levy um with the increased valuation. >> Thank you. Are there questions? Looks like Jim >> a couple of questions. Um, so on these all the other I'm looking at the uh see with the blue the blue tab ex um just each of these funds supplement LLB capital outlay blah blah blah we all 100% of that those actual collected taxes come to
038the school district. >> Yes. Okay. So, can you just help me understand our first our bond and interest fund? Um, that fund can be used for principal payments on bonds, interest payments on bonds, and associated fees, I'm assuming. >> Uh, yeah, primarily principal and interest um according to our debt service uh schedules on previously sold bonds. So, I've attached that in diligent um is I think it's on the next action item section of the agenda, but we have our debt service schedule um we can review if you'd like. But yeah, the bond and interest fund is for debt service only. It's not for projects, not for salaries, just for repaying our debt. So, um I didn't review that debt schedule in detail, but I know we're about $480 million of total debt outstanding. >> Um
039there's some moving parts here. So, at the end of June 30th, I believe it was closer to 415 million, but we do have a planned bond sale this fall, which will certainly increase that by close to 100 million. >> I'm just looking at last year's number. Um, so when I just do like rough math in my head, like annual principal and interest payments on 400, I don't know, $50 million of debt at the effective interest rates we have is something like a $35 million annual 30 to $35 million of annual, you know, cash outlay. So I'm just wondering whether we're building reserves in that bond and interest fund if we're eating into reserves. We build up a reserve in order to pay off a bond early to reissue a new one. >> Yeah. So when
040we look at the debt service schedule um you'll see this year's uh bond and interest payment. I believe it's approximately 55 million. The next year I think it drops to somewhere in the low 40s and then after that. So that schedule isn't contemplating the sale of bonds this fall. >> So if we were not to sell bonds this fall and we just over the next 20 years repaid the debt service schedule every year we could reduce the mills by you know probably 0.5 mills. So we do have reserves in our bond and interest fund and that's where we use that every year to help us manage the mill rate and we're certainly using it this year to help us manage the overall mill rate. So, don't want to skip over a question if you still
041have one, but if you go back to the form and you look at last year, the 44.3 million of actual taxes levied in the bond and interest line. If you keep going to the right, you'll see 42.8 million. So, we're proposing a reduction in our bond and interest fund from 9.7 mills a year ago to 9.016 mills this year. The reason we can do that is because we have reserves in those uh in that fund to help us, you know, bring down that mill levy because we are increasing our LOB, increase our cost of living, extraordinary growth, all of these funds that help support the comp. They need to go up and so we're trying to use the bonded interest to kind of feather that and keep it as flat as we can. >> Yeah.
042So I I mean I support that. Like I was asking questions this morning that basically got into um whether we can we have flexibility more flexibility really more flex I mean my question is do we have more flexibility to cut capital expenditures in the near term and therefore the mill levy while maintaining all the operating funds um at their level and I I'm again this is back of the napkin math it's not Jeremy math but um it um it just It seems like there's cushion in our bond and interest fund, but that's somewhat dependent upon the size of some some future bond offering, right? Or some sort of bond approval that that goes out to the voters. Um the the second part of that question, then you can answer it all together and then I
043think that's probably my question. on capital outlay. What percentage of that let's call it 36 million last year um is actually used for capital expenditures meaning you know acquisition or purchasing of materials or capitalizable assets and what percentages can be is used for compensation for classified staff. the compensation piece. If you want to consider the outsourced uh contractor agreements that we sometimes lean into for outsourced custodial uh grounds, for example, um that number is probably in the mid to high 40% range. Um then some of the uh other half of capital outlay is where uh Jake's team, Brian's team, they have budgets that help them with kind of the repair, fix, maintenance things that come up throughout the course of the year. Um you know, are there a few automobiles purchased out of capital? Sure.
044Um just keep our fleet, you know, rotating and and making sure that we have a usable fleet. But um I don't know if I'm really answering your question, but there is a lot more of the capitalized assets coming out of our bond referendums than our capital fund, capital outlay fund. Um, so that does have a little bit of variance year in and year out, but generally when you look at eight mills and you know last year we spent roughly $40 million in capital outlay less just less than half went to kind of the eligible salaries for employees and contractors and then the other you know low 50s went to basically operations and IT for break fix. Now there are times where we do lean into capital outlay for the purchase of curriculum software. So, I
045think we've kind of put those days behind us, though. Um, in the last couple years as a board, you've probably noticed some curriculum being presented for expenditure out of capital outlay. Uh, we're now on a curriculum schedule uh through Dr. Buzzinsk's work where we can rely on the learning resource fund to kind of meet all of those needs and we really wouldn't need to lean into Capital Alley as much for curriculum software. Um but again inflation does impact you know the work that Jake does and his team. So we just want to make sure that you know we can responsibly you know budget for this 8 mills and you know if the board gives us direction that we have fewer resources then you know Jake and I got a some work to do. U comes
046with some choices that may jeopardize asset preservation work that he does. Um so again just trying to give some context of why we request the um really helps us kind of with the break fix maintenance needs of the district. >> Yeah. Um so I sent you an email on this. You don't have to give an answer, but it'd be something that I think is necessary, um at least for me to make a conclusion next month when we, you know, weigh in on the actual budget. um which is uh was what is our actual and this is probably there's probably a range of capital expenditures purely to maintain not to enhance or to expand but just to maintain our facilities um at their current state right 30 year old building it's going to need a new
047roof at some point all that stuff. So just to keep it as as um so that 10 years from now you don't come well these guys left you know they were on the board and they didn't pay attention to our assets and um so that's a number that I'd be interested to know um because it impacts the way I would think about what we're doing in any bond offering and then and therefore um what our actual need is like it's our bare bones need is for any future bond issue. >> Right. And so >> that's kind of the that's kind of my thought process. >> Yep. And we got that request from you and Jake and I and Kai will you know sit down around a table and make sure we give you a solid
048number. >> Okay. Thanks >> Jeremy. I got one more followup. >> Yeah. >> Patre go ahead. So on assessed valuation, that's really the county's determination what it believes the increased value of the property in the county is for this next year, right? >> Yes. >> And that valuation could be um 5% 10% but there's a percent increase in terms of the expected appreciation of that value of that property. >> Yeah. So the districts in the next notice we will review, I can show you that number provided by Johnson County. approximately a 3.8% increase districtwide for assessed valuation in building our budget. That's an average. So some taxpayers may have 5% increased on their residential property, some may have two, but on average the increase is going to be about a 3.8% increase. >> Right? So
049by keeping our tax rate the same as last year, what is the portion of the average of our keeping the tax rate the same based on our $6 million increase? >> Do you mind repeating that? Sorry. So, so based on based on keeping the tax rate the same and understanding that the assessed valuation has increased somewhere between three and five or so percent >> right >> a year the districts by keeping the rate the same is or is not um eating into that percent increase in a significant way. So, we are by keeping the mill rate flat. Let me see if I can answer your question. We are increasing taxes collected at the local level with mill levies we control by approximately $6 million. >> Right. And so, how many people are in Johnson County
050or in school district roughly? 120,000 people. >> Sounds great. Yeah. >> Right. Clay might know that better than I. How many people? >> That sounds like ballpark. So my point is the $6 million is not a substantial portion of that increased assessed valuation. So I ran this calculation. Essentially, what I was trying to do is calculate on the average residential home by keeping the mill rate flat, what was the district controlled mill rate increase on a dollar basis, they would experience. And on a $658,000 home, which is the average home in Overland Park, the increase is about $97 a year in taxes for the mill levies that we control. Okay. So, I don't know if I'm working around to your question, but um for an additional $97 for Blue Valley control mill levies, the average
051homeowner would see their tax bill go up by $97, >> right? And if and if the average assisted valuation was 5% or 3%, whatever, that's a significantly larger number than the $97. >> Yeah. So, if we had let's say another year where the assessed valuation increased by six or 7%. >> Yeah. >> This proposed mill rate would most likely drop. >> Right. And so so we're not taking a big chunk out of the increased value of people's property as it increases over time from year to year. Um, yeah, our mill rate is hopefully considered to be reasonable by the board and hopefully taxpayers see value in what Blue Valley does. So, I I think that this is a reasonable mill mil mill rate keeping it flat. >> Right. If my my house was worth $100,000
052and the value went up $3,500 and the assessed valuation and the tax rate considering It would be less than $97, right? If my house was >> that $97 was based off of a $658,000 home, >> right? So, you could divide that 97 by six and roughly get about, you know, $18. Right. Right. >> Versus my $3,500. Correct. Right. Okay. >> Clay. Um, I just have a couple points that I want to make sure that we get clarified. Um, you mentioned something about potentially dipping into reserves to make up some if we did not if we did do revenue neutral, we would pro we would have to dip into some reserves unless we wanted to make some significant cuts. Um I I wanted to give you an opportunity. Maybe you can just address the risk that
053the district would face regarding our credit rating regarding um dipping into our reserves and bringing those reserves down. >> Yeah. So the credit ratings um the rating agencies u when they see strong operating reserves that is one of their credit strengths that they identify for Blue Valley. So um I know that we have for example notified Moody's you know we plan a small spend down in our reserve balances and as long as it's planned and controlled I don't think there's any alarm um if we took a serious bite out of our reserves in the course of one fiscal year that might catch their attention and it would just you know it might result in us having some sort of negative outlook or maybe even a downgrade. So, um, the other thing that kind of keeps
054me up at night, I suppose, is the district's budget is relying on some interest income on our reserve balances. So, if those rates that we're currently earning in excess of 4% drop substantially, you know, that creates a more of acute budget issue that we're going to have to be ready to respond to. and strong reserves help us kind of weather that storm until we figure out, you know, our plan forward. So, we have some revenue in built into our projections that assumes a certain level of interest income and you know, hopefully that's a reasonable estimate. So, reserves just keep us stable. Um, so when the federal government, for example, you know, if there's a withholding of title funds, you know, we don't need to go in panic mode overnight. We can we have reserves. so
055we can basically not never be forced into a a panic situation. So, >> and what is our current uh rating? >> Um, Moody's it's AAA and with S&P it's double A. >> And are those the highest? That's is that those are top tier? >> It is for Moody's. uh SNP uh there's AAA available but um one of the reasons they don't allow us to really achieve AAA is we're governed by a formula which doesn't give us the freedom to chart our own course really. So by us having to live under a formula they see that there's some constraints there on you know our operating budget. So that's one of the reasons that we don't have the AAA and S&P. So, but essentially we're as high as we can get >> in Kansas. >> Um, and
056if we were to get a downgrade in our credit credit rating, how would that affect us? >> So, we got a bad, you know, negative, how would that affect us budget wise, financially, going out for bonds or whatever? >> Yeah. So, a future bond issue, um, the market would, you know, not offer us as competitive rates as we're currently getting with the AAA rating. So, there would be a higher um portion that would need to be dedicated to interest income in our bond and interest fund. So, you know, that's money that wouldn't be available for projects. So, that would be kind of on the capital financing side where, you know, a downgrade could ultimately cost taxpayers in the future more interest income than we're currently paying. So, that would be one re uh one way.
057Then the other way like I just spoke to there's there's variables in our budget that you know have some unpredictability to them and having reserves just helps us to kind of weather any kind of storm that we have. So >> and with this um so we've got this revenue neutral rate form that we have to publish and walk through and go through. Um so this this revenue neutral rate it it assumes no increases in costs. Correct. Doesn't It doesn't make any assumptions regarding increases in costs. All it does is talk about what we brought in last year. It's going to be the same as this year if we were revenue neutral. Right? >> Revenue neutral is kind of ignores the expense side and just says if you want to bring in more revenue than you
058did a year ago, you have to follow the law, have a revenue neutral right hearing between August 20th and September 20th and check all the boxes. So, >> so as I understand it, um, revenue neutral, right? It doesn't account for inflation, a tight labor market in the teacher arena. It doesn't account for the doubledigit increase that we're seeing year after year after year in our insurance premiums. Um, yet you guys have brought us a a proposed flat mill levy and really increasing 3.8% I think >> um despite some of these other extraordinary expense increase in expenses. So >> um while I don't want to see any increase in my own personal taxes I I think you've done a pretty good job of really tightening things up to bring this to us. >> Can I ask
059a couple quick questions? Are you through Clay? >> Yes, Gina. Can you remind me what the special liability expense fund is? >> Yeah. Um, if we have general liability claims, uh, we have a deductible. I think our deductible is 250,000 per claim. So, uh, this fund really helps keep those costs out of our general fund, just kind of preserve dollars for teacher comp. >> Gotcha. And then what we're approving tonight is the intent to exceed revenue neutral publication. Right. >> Right. Just >> the maximum amount that our budget will be in effect will likely be less than >> I mean close close to it. >> Yeah. That's the next form. >> Okay. >> This notice is just letting taxpayers know of our intent to exceed revenue neutral. The next form is the one you're touching
060on which sets a legal max expenditure by fund. >> Okay. Okay. Thank you. >> Um this will be worth our time if you guys can give me a couple more minutes. Um Kyle, can you pull up the redacted tax statement? All right. So, this is the tax statement. It's really behind the revenue neutral right law. Taxpayers get this in the mail. Um Kyle, if you can go to the second page, highlighted a line here. This is good for you all to know. Um the line we highlighted was the 229 bond. So this is notifying taxpayers of all the taxing um subdivisions and their intent to exceed revenue neutral. Um, the reason I'm focusing in on the 229 bond, if you look at the left hand side of the tables, there's a 2024 tax. It says
0619, I think 707. If you work your way towards the middle at that top column, I highlighted the 2025 proposed tax and it shows 9.337. Okay, if you remember the bond mill rate on the notice that we reviewed with the blue headings, that proposed mill rate was 9.016. So they're different, right? We're actually proposing 9.016, 016, but the revenue tax statement or the revenue neutral tax statement that went to taxpayers is showing 9.337. Also, all the way on the far right, I've highlighted a pretty nominal amount, positive like $497. That amount should actually be a negative 1.525 million. Okay? So we are decreasing our mill rate below the 9.337. So a natural question is why did Johnson County tell taxpayers that we have a 9.337 bond mill rate when back in July we had an
062intent to lower it to 9.016. And Johnson County clarified that today for us that they believe this statement is following statute which says you include the rate if you intend to exceed revenue neutral and if you don't intend to exceed revenue neutral you include the RNR rate. So a taxpayer is going to get this and they're going to not appreciate the fact that the board is reducing the bond mill rate by 1.5 million. So, I think they're getting only the increases listed and not giving you the credit for the decrease. So, between now and September, if you're taking any arrows or feeling like taxpayers are like wondering why is there just nothing but increases, well, there should be a tax decrease there. That might be something we'd have to work with our lobbyists and legislators
063to change moving forward is if we have a proposed tax decrease in that fund, give us credit for that in the statement. credit. >> Yeah. >> Correct. >> If I could just ask one question. So, and I know we've covered this the over the last few months, but just so that um people understand reserves. Um you know, we we talked about dipping into our reserves. We don't have a huge pool of reserves. Um the goal is I think right now we're a little over one month's worth of payroll and we're going to be dipping into that and bringing it down closer to about one full months worth payroll if we had no funding sources. Is that >> Yeah. So over the next two fiscal years we plan to structure our operating budget making some assumptions
064on interest income on our idle reserves on CPI increases on base state aid next year. All kinds of assumptions are built in, but our end goal after a two-year period, Jody, is to have approximately one month of operating reserves going into the new school finance formula, which would be in 2027. Other questions or comments for Jeremy? I've got one which sort of piggybacks on what Jim and Clay were touching on and it's on the expense side which I know we're not supposed to consider on revenue neutral but I wanted to look ahead to the budget. Uh do you have an in inflation number that you work with? If if we did everything that again how much more would it cost? What percent would be inflation? You understand what I'm saying? If we >> all things
065being equal, >> what's your inflation factor? How much more will next year cost? >> Um, >> what percent? >> I'm using about two and a half. >> Two and a half. Okay. >> For non-payroll, >> right? Okay. >> And non-healthcare. >> Thank you very much. Anything else? >> I need a motion for the board to approve publication of exceeding revenue neutral for 2526. I move that the board of education approve the publication of exceeding revenue neutral for the 2526 school year. >> Moved by Gina, second by Patrick. All in favor, raise your hand. All opposed. >> Can I can I just make one comment? Um when when you're this is the form you're going to file. That's what we're approving. We're going to publish this in the Johnson County Post and the Kansas City Star.
066Has to be published 10 days minimum before our hearing. So, we're well ahead of that requirement, but simply notifying taxpayers of the right to come back in September at these stated hearing times and talk to you about any concerns they have. >> But, but in effect, we're approving the publication of this form as opposed to just gen generically to exceed revenue neutral. >> Yes. So you're setting a ceiling by approval of this form. So in September, if you wanted to lower any of those associated mill rates, you could do that. >> Okay. All right. >> It passes unanimously. Thank you very much. Moving on to the next and that's to approve the publication and notice of hearing 2526 budget. >> All right. This is another standard form school districts complete. Uh really what we're doing
067here is we're establishing a legal maximum per fund with this notice and also you know showing uh the proposed tax rate based off of estimated valuation. So again the top of the notice is notifying taxpayers that immediately following the revenue neutral rate hearing starts at 530. This is at 535. It's an estimate. Um but it's September 8th again taxpayers will be notified that they have an opportunity to address you about the proposed tax rate and use of funds. So again I think the key thing here is estimated valuation. If you scroll to the very bottom Kyle um there's online one I think it's 130 says assess valuation all other funds that is the three 3.8% 8% increase a year ago 4.5 million I'm sorry billion and then 4.7 billion this year. So that has historical
068information for the last two years on assessed valuation. It also shows our general obligation bond debt. Um, so that's some information for taxpayers to just know of the assessed valuation changes, changes in our bond indebtedness. And then in the bottom right, um, kind of midway through the page, the total USD expenditures, working your all the way over to the right, you'll see that same 53.594 mills. Um, a lot of the amounts listed in the proposed budget column are estimates, not to exceed. That doesn't mean that we can't exceed them, but in order to exceed any of the proposed maximum expenditures by fund, we'd have to have another budget hearing at some point during the school year to reset the new legal max. So, this is simply setting a legal max. And in some cases, if
069it doesn't impact the mill rate in a negative way, I've tried to give ourselves a lot of cushion to, you know, take on any unforeseen costs. So, any questions about this form? >> Jeremy. >> Yeah, quick quick question. So, basically, because we've gone in and been very intentional with our budget for what our needs are the next year, you need to have that additional solution for the unexpected, right? >> Yeah. So, if you needed to uh access reserves for any reason or you had a large capital outlay cost come through unexpected, you know, we would have sufficient budget authority that would let us address it sooner. Otherwise, we'd have to notify the public of a budget hearing, wait the 10 days, give board approval. So, it's just giving us um the authority now. Um, but
070I think you'll remember maybe two years ago we had to republish our general fund. Um, so sometimes what can happen on republishing your general fund is you actually qualify for more state aid than I'm estimating in this budget. Um, so if that were to occur, I may come back to you, you know, in May of 2026, you know, asking for a republished budget on general fund in order to receive additional state aid uh that we may have qualified for. Some of that could be driven by our our waitings on September 20th, uh, special education, uh, state aid that might be in excess of what we're estimating now. So, all kinds of reasons why our general fund estimate today might be different based off of September 20th and really our special education state aid could be
071a variable as well. So, >> right. So, so obviously the function or the purpose here of that additional cushion is simply for the unexpected because we've got a pretty tight budget. But number two, um we don't want to disrupt the educational process of our students because we don't know what may happen. >> So I I propose this cushion. It's up to you as a board you want to >> use it. So, >> but the reason it's there is not to disrupt the education process during the school year. >> I believe it gives you the authority to act quickly if you want this board. >> Yeah, you have a cushion and a bunch of funds so you can move money around. >> Um, >> that's what I see going on. I mean, which I think is
072fine. I think the cushion like if I look at capital outlay if we take our proposed tax revenue plus carryover balances that we have that proposed amount for capital outlay would basically be we could spend every penny we have in that fund. We're not going to do that. Um special education is cushioned pretty heavily but you know Dr. Schmidt, his team, sometimes they don't have a whole lot of insight into some of the costs that they're going to face until the year gets started. And so, I don't know if I'm answering your question, but I I think the the legal max giving us cushion is really intended to take on the unforeseen. Do you have other questions, Jim? Anyone else? Do I have a motion to uh approve publication notice of hearing on the 20
0732526 budget? >> I move the board of education approve the publication of notice of hearing for the 2526 budget. >> Second. >> Moved by Patrick, second by Gina. Any discussion on the motion hearing? None. All in favor raise your hand. It passes unanimously which takes us to any board comments any u discuss or any comments for the good of the district. Patrick Sonia, >> I think that our finance people and our administrators have done a fantastic job and I feel a little uncomfortable with the fact that we only have one month of reserves and that scares me. That really, really scares me. So, but I think you guys are doing a fantastic job and that you're doing the best you can with what you have. Um, but as a board that really really terrifies me
074and that will keep me up at night. >> Gina Jody with her mouth. >> Maybe I'll go to Clay. >> I'm eating chocolate this whole time and so I finally partake. eight pieces. All right. Um I just want to say, you know, I'm excited about this school year. Um there's a lot of energy out there and welcome back to our teachers, our staff, and uh students and families. >> Thank you, Jim. Clay. >> Um of course, thank you to our public uh forum speaker or speaker singular tonight, Mr. Roberts. Thank you. Um, big thanks to Mrs. Phoebe Lewis and Pleasant Ridge Middle for inviting me and about a dozen community members to come in and uh, talk to the uh, returning staff and new staff members, kind of pump them up as we begin the
075school year. So, that was kind of a cool thing that she did for them this year. Big thanks to the Rally in the Valley team for all the planning, pulling it off, and an amazing pivot with no power for the afternoon session. Wonderful job. Excellent job. Um Dr. Chapman did a great job at Leewood Chamber of Commerce during her remarks. Um I loved Sister Steele's comments um after 25 years, 25 years as president at St. Mary's. um recognizing that if we don't address the social emotional issues that a kid is going through, we're never going to get through to them and they cannot learn. So after 25 years, Sister Steel has uh uh made that one of her key points in her remarks. So I really love that. Um, again applaud the HR team and
076Carrie Meyers and her team, the BDA team for such a collaborative and transparent um negotiations and process and at the end of the day get your legislators legislators to please fully fund special education. >> Great. Thank you, Clay. Excuse me. I want to echo those thoughts, too. It was great at the uh chamber breakfast, I guess it was. Not I was thinking lunch. Uh and it was great to be able to see Dr. Chapman uh really just do such a great job having been on the job just a few weeks. It as I wrote you, I said it was it made me proud that our board made that higher. It really reflected well on the district uh rally in the valley and also the u welcoming the new on the onboarding event. Both of those
077you can see the enthusiasm of the teachers and it looks like we're going to have a great year. So uh with that we stand adjourned.