001agents and do that at the beginning of our regular meeting okay so i will go ahead and begin that's okay so we do have some guests um first of all i want to thank uh aaron oh okay we're doing this uh a live stream so i'm going to make sure it was on so again thank you president daisy thanks to eric long um who was on the screen with us today virtually and also jane hernan from ice miller to assist us as we continue to progress through the our strategic plan number four and just as um just as a reminder briefly number four's priority is facilities and technology to provide a safe and efficient learning environment and the measurable objective that we've been dealing and talking about is affordable 4.1 which is optimized utilization to
002determine feasibility of current facilities or other possibilities so there's two aspects of tonight's work session first one is during the september 28 work session and then the school board meeting the board approved the recommendation to approve the resolution authorizing appraisals of real estate that process is complete so tonight i will ask that you approve the resolution authorizing negotiation and execution of the purchase agreement of course that will be later on in the regular meeting if you approve this tonight we will make sure that the execution of the purchase agreement does not automatically mean the purchase of real estate because there are other steps that need to be taken before that can happen and so part of this work session is just the question if you have any questions on that of course we'll talk about
003it more in the regular school board meeting but if you have any questions you can ask those now or you can wait until next time because we do have our guests but it looks like i don't know where they went so so you guys probably can hear us but you were kicked off on the airplane i don't know why so that's not good because then we can't hear you there they are right back yep so i think unless you have any questions i will go on so we can have them our main event so they can hear us that's all right just making sure that we've had that little technical business calling yeah yes so we're good all right all right okay so the second part of this work session is really our main event
004i guess and our guest so we appreciate them again so just remind the number uh the studies of facility efficiencies that we talked about back in september 28th and i know that's been uh several months ago and also shared with all of our different staffs the three different facility of efficiency that we've been discussing is retain all schools shuffling grade levels and and or build a new high school and so eric and jane at this time though will now share their expertise because they are the experts concerning the controlled project process and this process this presentation though can be part of any of the three efficiencies that that we have discussed which i just mentioned retain all schools shuffling grade levels or build a new high school so i don't know who's going to start
005there eric or jane but again we appreciate you uh being available for us tonight and share a little bit um about the control project uh process thanks mike i'm happy to start in part because i have some documents open that i might be able to do a shared screen with okay and i would start with oh it appears i can't currently share well i can make you a host here if you give me a second sure good multiple so what i'm attempting to share is a powerpoint kind of a table can you see that yes okay i have dual screens and sometimes it gets messed up so um [Music] try to make that full screen okay so as it pertains to projects any school corporation has different thresholds based upon your individual gross assessed valuation
006within the last couple of years the general assembly indiana general assembly tied your project threshold if you will two year gross assessed valuation which typically over time are going to increase so it kind of becomes sort of an indexed dollar amount so it also changes every year because that number changes every year so you'll see on on this slide total project cost for this calendar year 2022 for nxt of wabash county so if you have a project that is less than roughly 5.8 million dollars exactly up on your screen um there's no formal taxpayer opposition which will refer to as a non-controlled project um and at the end of the day um any debt issue over that process is within your search tax tax in between that 5.8 million and this figure you see of
007roughly 12.1 million dollars again based upon your gross assessed valuation if you have a project that has a total cost in that range that would be subject to what we call the petition or monsters process and again if you went through all that process um you instilled any debt extra that would be within your tax cap so they would still be within your circuit breaker the last figure is if you have a control project greater than 12.1 million dollars of change and that project would be subject to referendum and you'll know that both of those processes they subject to um because they're there basically is um taxpayer process by way or limited determination hearings that you as a as a board let your voter base your tax base know about a given project and then
008once you go through those hearings and publish notice of adoption you basically have the call to refer to it kind of as the application petition period if you get a taxpayer petition then we have to go through whatever that process is either petition or monstrance or referendum um you'll know the big significant difference is if you have a project which is greater than 12.1 million dollars you run and you win a referendum that debt then falls outside of any certain rate of tax steps um so whereas in every other instance if you issue bonds out of this process it would be within the tax steps if you run and win a referendum basically uh it's an oversimplification but essentially um every taxing unit whether you're at one percent two percent or three percent would end
009up paying 100 on the dollar and not have any circuit breaker that would be tripped i'll pause there and see if we have any initial questions based on that and just looking at the various levels of total project costs is our gross av correct on there i thought it was just under 800 million does that require it might be helpful to repeat the question because i couldn't really pick up if that was a question or a comment that might be a gross indeed he was asking about the is that our about our ab our ab has been around 760 million dollars but we would still fall i believe under that threshold because it's the it's the isn't the greater or the lesser of the two did you hear that is it the the lesser of
010the two eric on that a b that it so there's two different figures most of the time the world we operated we work off with the net av which takes into account all the um deductions etc um for this purpose when we're talking extremely about estimating project costs this is the one instance where we look at where's assessed valuation as a hosting net most of the time again when we're dealing with most other school calculations or formulas are dealing with net av this is the one instance we're dealing with gross yeah i don't see any other questions on that eric thank you yeah i'll stop sharing that screen then so again when we talk about process if you have um any project that is referred to as a control project whether it's subject to petition
011or monsters or referendum basically start that process out by conducting two school board meetings uh two school board hearings um [Music] there's no set limit on how far apart those meetings have to be so they could be within your regular compromise of your um typically twice a month orbeez they could be space further apart whatever you prefer um and then again once we conduct those hearings and let folks have comment during those two hearings we would then publish a dose of adoption assuming the board adopts the requisite resolutions and then wait the during the application position period to see if the community seeks either those processes and if they do then we go either to the petition or master's process or we would start taking the steps towards putting a question on the ballot if
012it was subject to referendum any other thoughts or questions based on that well you're explaining that very well thank you i would also note too as an aside that the referendum process does involve quite a few other parties they're basically outside of control of the school corporation so some of those parties include the county auditor's office because the form of the ballot question changed by statute as of last july of 21. um so now we have to work with the county auditor um who does a certification on various percentages that have to limit the question we work with the county election board to do preliminary and final approvals of what the form of that public question would look like on the actual ballot and then we also have to work with the dlgf because they
013also are statutory required to review a ballot question um they're given a certain time frame to do that so um there are a lot of other steps that have to take place um and they all have a deadline so um i say i just said that there are you basically have to work backwards quite a bit in order to if you do want to put something on a ballot in particular you have to work backwards quite a bit to conduct your own approvals and then go through the approval process with all the other parties in regards to the ballot process is there a requirement as to which uh ballot it's on for primary versus general can it be on a primary or does it have to be on the general does it have to be
014our primary as of right now it might be on either primary or general so in other words could be uh okay or we're gonna that's remember a question i just say it thank you sure we're having great weight wait time as teachers sometimes we don't uh give them the three to five seconds for a wait period out there but we're doing a great job here so but it's good anything else of the asset from us you think would be helpful eric is there any uh ballot restrictions like how many times you can put something on a ballot um that's a good question so the short answer to that is if a ballot question is successful obviously we would move forward and issue the bonds and continue on the project if it was unsuccessful that particular
015project as described would be considered defeated for a period of two years essentially try to do the math uh 720 each day something of that nature unless there is a there is a process by which um the voting community could um put together another petition to ask to only wait one year as opposed to two and that would be for that particular project as described in the ballot and who do you uh petition that too eric um i have to go back with the deceptions your fingertips they would certify the number of taxpayer signatures if there weren't sufficient tax payers then it would go to the county auditor and they would certify the tax i'm sorry voters first then the auditor would look at the taxpayers and if you had enough then that's all that
016would happen you could go ahead and start that over again it would just go well again the reason why we have you coming here tonight um is just to learn a little bit more we eric of course and jane you worked with us quite a while as far as our bond council but when we talk about our strategic tour and talk about different different options that we have these are some things that we just want to make sure that the school board learned a little bit more about this you know we talked about it uh you know we've learned about i you know legislatively we learn about different things too and even the question that mr daisy had um you know there was some legislation at one time that it could only be on on
017the november ballot but that has not been passed of course so it still is the november or the may but that's some things that legislators were looking at also but anyways it's good just to give us this information as we proceed on and as we look at different ways to continue looking at our 60-year kind of 60-year look out there as far as our plan we still look at our our pictures you can't see those but we have our board members from when msd became a school district and i know that they had a lot of thoughts about you know what's it going to look like 60 years from now and i think that's what our goal is to is to say what what can we what is our long-range goal and plan for the
018next you know 40 50 60 years so appreciate your time here dr i don't know if you had any more i guess you know you talked about just some time tables and some requirements that we would need to do and also have to depend on some other entities for those requirements you know what kind of time like in general how much time do you typically need to have in preparation before a ballot would potentially be put on a november let's say um election or a may election i know the more time probably the better but can you talk a little bit about that that turnaround process sure um and we again we could work backwards so using a general election question on november 2022 so this coming november i would use as an example um
019generally speaking i would say that even here sitting in april it would be pretty tight to be able to put something on november 22 ballot here's why um the deadline to have all of the action done so recall that i mentioned a few moments ago that we have to work with the county auditor the county election board and the dlgf all independently in all kind of different potentially overlapping times um the deadline for all the action to get approved for the county election board to do a final approval of battle languages by noon on august 1st prior to that again we have to have the count election board typically meet twice wants to approve on a preliminary basis the form of the question and then to do their final approvals in between then the dlgf
020has to do their own sketch for a review of the public question and to make sure there's no there's no bias or against the project prior to that again there's work with the county auditor to help do their own certification on certain percentages that are statutory required to go into the public question all of that work only happens if and when we receive an application petition um and so there's typically up to 30 days to do that and that only happens once you have conducted two public hearings and the school board has adopted their requisite resolutions um we call one in particular the preliminary determination resolution so once that's been um accomplished um in order to get to a public hearing where we have a preliminary determination resolution and what we refer to as a
021project resolution or a 1028 resolution we have to have not schematics but we have to have some level of detail as to what the project entails because there are certain boxes that have to be checked if you will or legal requirements that have to be met as it pertains to what the educational needs are and how the proposed project would meet those needs so again and don't have to get down to a certain design level but just enough to be able to let the public know um in some level of detail where the project is [Music] those particular requirements well i think you did a great job going through the legal requirements and you know basically the summary is in order to get something on a november ballot although those things that eric just went
022through has to be done by august 1 by statute period for may all those things have to be done by about the third week in february that's just the legal steps the part that is much more difficult and um eric certainly has been in a lot more conversations with your administration than i have lately but to the extent that you need to have a question on the ballot because of circuit breaker or because you think that somebody else in the community is going to put it on the ballot then there's a lot of upfront preparation time because in the best situation it is hard to win a capital referendum and as as eric mentioned the general summary changed the form of the question and some of the restrictions here last year um going to this
023may election we have a handful of schools that are doing a capital referendum and a few that are doing an operating referendum so it'll be very interesting to see how that change in the form of a question changes the success rate i was trying to pull up some of our statistics we have some stats about how what the percentage of success has been in capital referendum and operating referendum but the capital is not merely as successful in the school referendum world as the operating is there's a several reasons for that but i would say to plan for having a referendum especially if it's a project that's complicated like you're moving kids you're changing buildings you're changing configurations there's a lot of upfront conversations that have to happen and not just with your school community but
024unfortunately the people who vote regularly in elections aren't necessarily the people who are in your buildings every day my guess is if you would order ask your clerk for a copy of all the registered voters in your school corporation and compare it to your parent and teacher list you probably would be surprised at how many people aren't registered voters and so when you're looking at a referendum election all of a sudden you're looking at a really different way to talk about the project what is going to make people who regularly vote in that election that you're going to be on that ballot whether it's may or november what would make them vote yes because it's going to certainly look like and in many ways probably is a place where you are raising their taxes and
025so if you add to that anything that moves their cheese or they're mad about something else like a basketball coach or your umass or you name it um all of a sudden the chances of success on a referenda ballot becomes even more difficult and i'm not trying to be negative i'm trying to make sure everybody understands the time and and what it takes to educate a community and get to a place where you can have a successful referendum it's it's a lot more than just the legal steps um and many of you all know that i mean you saw wabash city run their referendum a number of years ago and that operating referendum how painful that was to a community um but i don't have any more questions about that i don't know eric if
026you can pull up the form of the question i was just going to ask you could you like what is it in the question that's been changed that has made it more confusing um that were easiest so hopefully you'll get it i i put on there what vigo county's question looks like lebanon schools question in franklin township they're all going to an election here in 21 days and you're going to see sometimes we have bulleted versions of it i didn't have a chance to do that while you were talking but as you go through it you can kind of walk through the question once eric gets it up on the screen there and you're gonna see it's ugly um for a couple reasons one reason is that it now the general assembly wants language in
027the question that says the average property taxes paid to the school corporation per year on a residence will increase by x percentage and to figure out those that calculation pretty tricky your financial advisor will do it for you but in this these three examples here one of them is 55 one of them is 21 and one of them's 24 and that's just um and and these are not some of them aren't particularly big projects in their large districts so it's that percentage is is very difficult to try to explain to somebody because it's just the school corporation's share of your taxes um okay go ahead eric i'm sorry can you see the old informative question until 2021 yes so what's in red is how it used to be and it basically just um well i'm
028sorry this whole slideshow you see what's in red is what were it's kind of the fill in the blind portions so it's basically a project description and it was rate based so it would say a project expected to cost x with a maximum [Music] service rate of y now um in contrast just the length of the question is much much longer and again the part in red is the only part that is permitted to be basically adjusted or described by the school corporation everything else is totally described so you've got these percentage increases um [Music] references the prior referenda if if that is applicable and so let me stop this and i'll pull up the document that james has shared and again those are based off of averages right so it may not yeah that
029average may not apply to me or may apply to me differently than it would apply to you because it's an ad it's it's actually worse than that because the whole calculation uses the word average if you think about it mathematically a median home would make a lot more sense because with an average you could have a few high-end houses and that pulls up that average opposed to using medium so you're absolutely a great point that's the first kind of problem with the way the law was written the second is is the school corporation's share of the taxes so for example let's say i'm paying 500 a year right now in taxes but only 100 of it goes to the school corporation if it says 50 in that formal question i think i'm going to now
030pay a thousand dollars in taxes not the 500 but it's only the school share that's going to increase by the 50 percent 50 so right away you could see that's just confusing because it's just the school share of the overall tax rate what is the increase it also as you can see here the third line talks about a residence and a little farther down it talks about business so you have two calculations one for your average resident and the other is an average business there's nothing in there about the two percent people so nothing in there about rental property or farm for example um so that's one piece of the puzzle that's much more difficult than it was before to pass and unfortunately the question starts out with those percentages so our schools then because
031when this first came out we knew about the the average and we knew that was going to be very very confusing so are schools putting out more information then to try to explain it more or are you allowed to do that or to explain what this really means yes yes i mean you can actually try to explain it the difficulty is you're still raising people's taxes in many cases because this is outside the tax caps and that's a whole other conversation it's very difficult to explain and when you have anybody who's opposed to you because they just don't want to pay more even a dollar more this percentage is just easy to throw at it as i just i talked to a superintendent today one of these superintendents and they said you know usually the
032taxpayers our community doesn't want to believe the government all of a sudden now they believe the 55 percent and 50 percent of this this question because if if you're opposed to it it's right in the question you know that's just very difficult to explain yes you actually can you can put a calculator on your website have a place for people to put in look up their own assessed value on their own property and see how much their annual bill will increase but it is hard and it's confusing and then when you add to it things that are reconfiguration of space or complicated projects that's a lot to explain at a quick election i guess is my point this is the kind of stuff you have to have quite a few meetings with your staff maybe
033even put together a group of community members who are well connected so that they can answer this when they're in the barber shop or when they're you know at the farm bureau or whatever so when those questions come up you have advocates out in the community who can say no no it's not going to be 50 cents here's how much it really will affect you et cetera and if you want to scroll down that vigos is there but lebanon and then franklin township is there as well and in lebanon's case they're actually replacing an existing referendum so it's coming to an end they got one approved i don't know 10 10 12 years ago they paid it off quickly so this actually will not change the tax rate that the people in that community are
034paying and yet it still has percentages of 21 in it because of the way it's calculated by the statute in this case 11-1 is four that's kind of an operating record example oh did i grab the wrong one oh i'm sorry they have a capital of one too i don't know why we were talking but here's another example of a capital referendum there is a lot of conversation out there to see whether it's possible that this question can get modified um but partly because there are a lot of schools who need to come back as eric was just saying for operating referendum and this language makes it very difficult to even win a renewal of an operating referendum so it's possible that next session we could get some changes to it it's hard to say
035certainly if you're ready to go and read and move forward you wouldn't wait necessarily for that i will say one other thing about the planning part again it doesn't have anything to do with the legal steps but i guess if i run a school board or in an administration i do think i might consider having some real polling done so when you get to the point where you think you know which of these options is the right one and you think you know about how much it's going to cost and therefore what type of tax rate we're talking about before you actually start those formal legal steps so eric was mentioning i would consider having some kind of polling done i know sometimes people don't want to spend the money on that i certainly understand
036it but i think it is important to try to hear from those people who usually vote what is it going to take for them to vote yes and going into this you want to be successful and so it's helpful to know what your chances are at least at the time you're taking this poll in may the election's not until november and obviously a lot of things can happen but at least at that moment in time you know you know what dollar amount if this was a 30 million dollar project are you more likely to vote for it or less what is that tipping point where you start to lose voters if they knew that the project was x are they more likely to vote for it i'll give you an example we had a school
037district a number of years ago who did some polling and they had a pretty good possibility of success except for a weight room and for whatever reason and i still don't know why that was a hot button that that people didn't think at that time that those kids needed a weight room so after the board and the administration got that back and they saw that it dramatically lowered their chance of success they took out the weight room with a project and they were actually able to win that referendum they came back a couple years later and did the risk the weight room on its own as a separate project but that kind of information could be helpful as you're trying to determine what is the right scope and dollar amount in talking to your community
038that's one way to find that wow jane i had a question and this might be too much in the weeds but on the franklin uh example and i know it's not up right now but the franklin example it talked about uh yeah that's fine but the amount of money and it went um over 22 years and i guess i was just curious what clarification of 22 years because most bonding i thought would be maximum was 20 years so i guess i was just curious about that yeah that's a really good point um it's going to be 20 years of payments you're absolutely right and it's but it's a 22 year lease and that's just sort of a technical thing for marketing purposes okay i didn't know if something changed that i didn't know about so
039obviously it hasn't changed i don't want to [Music] mistake this but this example that we have on the screen i believe that looking at it from a net basis that this proposed debt would be tax rate and neutral is that correct as well um i think it's the other projects that we are doing our tax review okay okay i know what you're saying i think this was designed probably not to be and that's one reason it's uh and explain that a little bit because that is confusing so what i was getting at yes so maybe this example doesn't apply but regardless of how we calculate the gross tax impacts you know in a lot of cases we're bringing around other debt and so we don't get to talk about in the form of the question
040being that effect so um they basically we have to consider this public collection in a vacuum um not considering any other community falling off et cetera and the other things too and i'll i'll pick on the question the form of the questions in front of us where steps are totally required to discuss the prior most prior referendum whether it's successful or not in this case it was more than a decade ago but statute doesn't allow us to uh not reference it for that reason so we have to add in this final sentence saying that for the decade ago we had an unsuccessful referendum so just a couple other pieces that are required to form the question now that seems to be [Music] overly punishing in the way that they're required to be worried if a
041referendum is something that you actually going to pull that trigger yourself and get on the ballot or you think it's likely somebody in the community will do that and we can talk about this separately there are a lot of different ways to approach that community conversation but it should be very well planned and thought through on how to get in front of and get input from those voters not just necessarily school users and there are a lot of ways to do that i guess well i was just going to say we're getting close to time to have a little break before we start our regular school board meeting so i didn't know if there's any other questions from school board members comments dr no thank you thank you very much very informational yes that's what
042we needed all right appreciate your time we continue to be at your disposal okay if you have any follow-ups after you've concluded i choose to digest yeah i guess it would be nice too i took a picture of it but uh the one uh slide that you sent to us if you could send that to me too that'd be great just to have that as a reference i've seen a lot of different ones but that was obviously very clear and concise to the point so appreciate that we did that after our last call with the anticipation of sharing on the slide tonight so yeah i would love to send it to you once we're all here all right yeah thank you very much all right take care we'll go ahead and end this call see
043you later [Music] before we take a break was there any discussion we wanted [Music] a building is one project those non-con they called it a non-controlled project and so that's what we have been doing we've been staying within a threshold and just doing little projects here and there over two to three years and that all that requires is just board approval then anything beyond that is when you run into either the remonstrance phase or reference it wouldn't yeah you think that's realistic because i thought it was back about two or three million it used to be pretty low and it's increased over time and like he said it will continue to increase over time but it's not going to increase significantly so here it goes all right listen during this work session and welcome back
044here for a regular public board meeting