Voters in the Gilbert Public Schools boundaries will decide this month whether the district can continue with its 15% maintenance and operations budget override and raise another $100 million through bonds for capital needs.
The district put the issues on the fall ballot May 16 with the mail-in election running from Oct. 11 to Nov. 7.
State law allows districts to go to their voters and ask for up to an additional 15% over the revenue control limit for a district’s maintenance and operations budget. That limit is decided by state funding formulas. The maintenance and operations budget, or M&O, encompasses the day-to-day operations of a district, including most salaries.
Associate Superintendent Bonnie Betz, who oversees the district’s finances, said this override is a continuation of an override voters approved in 2019. Overrides last seven years but begin to sunset after five years, with the percentage of override cut by one-third each year.
The voter-approved bond sale pays for additional capital items beyond what state formulas grant in what is known as district additional assistance. Much of the district’s bond ask this time is to maintain older district buildings so they remain useful, Betz said.
Both overrides and bonds are paid for by levying a secondary property tax upon district property owners. If the override and bond pass, the district will be able to maintain its current secondary property tax rate, Betz said, meaning property taxes will only increase with the assessed value of the property.
“The intention is no tax increase,” Betz said.
Override
GPS put a 15% override on the ballot for November 2019 promising to do three things with the money: maintain salary competitiveness for employees; reduce class sizes; and add additional campus security personnel, social workers and mental-health counselors.
Each year, the state requires districts to publicly present the results of override spending. Thus far, the result on accomplishing those three aims have been check, check and check.
The 2023 override is less about accomplishment of new aims than maintaining gains made with the 2019 override, Betz said.
“If it does pass, we’re just talking about maintenance of those things — maintenance of the counselors, maintenance of our class sizes,” she said. “We’re definitely not the highest paying school district in the East Valley, but we are definitely competitive, and we’d be able to maintain competitiveness so we can continue to fill our classrooms with appropriate staff.”
The district estimates the override will raise about $35.8 million a year that is placed into salaries and staffing enough teachers to keep class sizes low.
If it fails, the district would have one more crack at its passage on the November 2024 ballot before the current override begins to sunset in fiscal year 2025-26.
If that were to fail, the district will have to consider how to address the accompanying decrease in its M&O budget, Betz said.
GPS’ surrounding districts, with the exception of the Apache Junction Unified School District, all have 15% overrides in place already, Betz said, so GPS would be giving up competitiveness on that front alone. It would also have to go through a process to determine where the budget cuts can be made.
“We wouldn’t be adding any more pay increases,” she said.” That would be one thing, so we’ll be losing competitiveness quickly that way. But we do have other strategies such as stopping hiring, freezing hiring, so we don’t impact anybody, and really taking a look at all of the extra duty pays that we offer.”
Bond
Betz notes the district has carefully managed its bond debt since before she arrived in 2017, quickly paying off old debt so new debt can come in its place without raising the tax rate. The plan, she said, is to keep doing the same.
Betz compares it to refinancing a home.
“Let’s just say that five years ago you took out a loan at 4% interest, and then two years ago the interest rates plummeted,” she said. “But you’ve built up some equity in your house, too. So now you can actually refinance. You actually pull some money out and your payment would stay exactly the same.
“It’s a comparable discussion with the bond. So basically we’re paying off debt over time, and with authority and selling the bonds strategically when it will work to fill in the debt that we’ve already paid off, we keep the tax rate flat.”
Bonnie Betz, Gilbert Public Schools associate superintendent
Chad Thompson, Gilbert Public Schools board member
Barbara Seago speaks out against Gilbert Public Schools’ bond measure at the Sept. 26 GPS Governing Board meeting. (Screen capture from YouTube)
The bond has four aims: $72 million for critical facility upgrades and replacements, including $9 million for career and technical education and extracurricular activity spaces; $12 million for safety and security, specifically securing entryways, fencing and alarms; $12 million for technology infrastructure on intra- and interschool communication equipment, again mostly aimed at safety and security; and $4 million for student transportation buses, vans and equipment.
The district underwent a facilities study last spring with an outside consultant that determined the district has $198 million deferred maintenance backlog, although $20 million of that was addressed in summer projects.
Overall the study found the district’s facilities to be in fair shape but without addressing the backlog faster than the district has been doing it — about $20 million annually — the unfunded liability for the district would grow to $1.07 billion by 2052.
District officials said they considered the “facilities condition index” ratings the consultant gave out to be good news. But given potential growth in unfunded liability, it would be fair to ask if the $100 million in bonds will be enough, especially at a time of construction cost inflation.
Betz said that was a significant discussion district officials held.
“We wanted to honor the community and understanding the potential tax impact of asking for more than $100 million,” she said. “And we wanted to make sure that as we go through time, we are always asking the taxpayer, ‘Here’s what we need next; are you willing to fund it?’ so that we are actually communicating more clearly and transparently with our stakeholders on a regular basis. So no, it’s not enough, but it definitely will allow us to sustain the level that we are at today.”
Community voices
Gilbert Public Schools is going out on the question at a time when voters may be less inclined to support schools’ finance questions because of high inflation. Its neighboring district, Higley Unified School District, went out with a bond question in 2021 and lost handily, then went out again with a smaller ask in 2022 and lost by a larger margin.
Betz said there was a time when voters were more supportive of bonds because they could see tangible results as new buildings went up. But in district’s like Gilbert, which has declining enrollment, it is more about maintenance that cannot be seen as readily.
For the election’s informational packet to voters, the district received 13 statements endorsing the bond and 12 opposing it. The override got eight statements endorsing and two opposing.
Betz said the arguments against were about paying higher taxes during a difficult economy. That was where Barbara Seago went in a statement to the governing board during the public comment period Sept. 26.
Seago called upon the district to tighten its belt at a time when families are having to do the same.
“Some people think bonds are an investment,” Seago said. “They are, if you’re buying the bonds, but if you’re actually selling the bonds, it’s like a loan that you have to pay back with interest, and guess who has to pay it back? The taxpayers.”
Supporters of the asks included town leaders like Mayor Brigette Peterson, council members Scott Anderson and Kathy Tilque, former longtime GPS Superintendent Wally Delecki, former board members Charles Santa Cruz and Reed Carr and Gilbert Chamber of Commerce President and CEO Sarah Watts.
“As former mayor, I witnessed firsthand that strong schools lead to strong communities,” Jenn Daniels wrote in support. “Our schools attract families and businesses, leading to economic growth and better property values. Investing in our education system is critical to the well being of our children and the future of our town. ... By improving the educational environment, we provide students and teachers with the resources to succeed and innovate.”
The governing board unanimously supported the override and provided a support statement, as state law allows it to do for override. It cannot do the same for bonds, and putting the issue to voters drew a nay vote from Board Member Chad Thompson.
Thompson said he supports the override because he wants the district to pay competitive wages and attract talent to GPS schools. But he said, like Seago, he believes the district needs to tighten its belt when it comes to the bond.
“I think we need to be more sensitive about that,” he said. “And I think the state needs to start pulling its weight there. It’s no secret that we’ve got a certain percentage of our buildings that are 50-plus years old, and those buildings need maintenance.”
Thompson said he believed it would be appropriate for those who vote against the bond to pressure the Legislature to better fund districts for their maintenance needs.
Asked if efforts to get the Legislature to better support district capital expenses failed, could he see a time where bonds were needed, Thompson paused as he considered an answer.
“That’s a good question,” he said. “I think if there’s ever a definitive answer from state lawmakers that we’re definitely not going to be able to rely on them for funds to maintain our campuses, then I think we have no choice but to rely on the investors to pony up.”
Tom Blodgett can be reached by email at tblodgett@iniusa.org or follow him @sp_blodgett on X. We would like to invite our readers to submit their civil comments, pro or con, on this issue. Email AZOpinions@iniusa.org.
Meet Tom Tom Blodgett joined Independent Newsmedia, Inc., USA, in 2022, when the company acquired Community Impact Newspaper's Phoenix-area properties. Raised in Arizona, he has spent more than 35 years in journalism in the state.
Community: He has served as an instructional professional in the Walter Cronkite School of Journalism and Mass Communication since 2005, and is editorial adviser to The State Press, the university's independent student media outlet. He also is director of operations for an 18U girls fastpitch softball team from Gilbert.
Education: Arizona State University with a BS in Journalism.
Random Fact: He lived in Belgium during his freshman year of high school.
Hobbies: Tweeting enthusiastically about ASU softball (season-ticket holder) and grumpily about other local sports (pessimistic fan).
Gilbert Public Schools,
Gilbert Public Schools maintenance and operations override,
Gilbert Public Schools bonds,
Bonnie Betz,
Chad Thompson,
Barbara Seago,
Jenn Daniels
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