MYTH vs. REALITY
Cherokee County Education SPLOST (Ed SPLOST)
Based on misinformation currently being disseminated, the following information is provided:
MYTH: The state of the Ed SPLOST is a “secret.”
REALITY: The state of the Ed SPLOST is, and has always been, a matter of public record, with regular reports given at public School Board meetings regarding revenue collections and project costs; and all such reports for the last 10-plus years are archived on the School District website. The Ed SPLOST budget is part of the annual budget approved by the School Board; the budget is a public record, and public hearings are held. The Ed SPLOST and associated bonds were approved by and renewed by an overwhelming majority of voters (in 1997, 2001 and 2006); and the referendum details were published on the ballots in advance of each vote in media reports and legal advertisements and were announced at public School Board meetings. The 2000-01 Blue Ribbon Committee (BRC) made it known publicly upon its recommendation to the School Board that it would take a significant amount of time to pay off the costs to meet immediate and long-term critical facility and technology needs; and the School Board’s payment plan is on track to pay off the debt accumulated since then by 2028. Also, it should be noted that, since the initial BRC review, enrollment in Cherokee County schools has grown from 25,000 students to more than 38,000, thereby further increasing infrastructure needs.
MYTH: Ed SPLOST revenues have been misused.
REALITY: To address critical school overcrowding, the School Board over the last 10 years has built an extensive list of 18 new and replacement schools, as well as support facilities; renovated existing schools, as well as support facilities; purchased land for new and replacement schools, as well as support facilities; installed technology in new schools and support facilities, retrofitted existing schools and support facilities with technology and provided technology training to employees; funded repairs and maintenance of schools and support facilities; and made other infrastructure improvements and purchases. After all of this construction, the remaining principal debt is $354 Million, which will be paid off by 2028. The debt is significantly lower than the actual cost of the projects, as both Ed SPLOST revenues and bond proceeds have been used to pay capital outlay expenses. The interest rate on the debt over the past decade also is considerably lower than the inflation rate for construction costs. Had the School Board waited for enough Ed SPLOST revenues to accumulate to pay for infrastructure needs, the total costs to taxpayers would have been significantly higher. The School Board also has successfully refinanced bonded indebtedness to take advantage of lower interest rates to further reduce costs. The School Board has never missed a debt payment, and a schedule is in place to ensure that never happens. In comparison, the average homeowner who purchased a home in 2001 with a 30-year mortgage will not pay it off until 2031. The School Board also is subject to review and audit of all its budgets, including that of the Ed SPLOST. The School District has received a clean financial audit every year for the last 12 years from independent CPA firms hired to evaluate and issue an opinion on internal control and financial management of School District assets.
MYTH: Ed SPLOST is a permanent tax.
REALITY: The 2000-01 Blue Ribbon Committee recommended the School Board use a system of sales tax and bonds to finance immediate critical facility needs of more than $500 Million. Some of those projects have not yet been completed, as the School Board in recent years postponed the issuance of $160 Million in bonds due to declining sales tax revenue collections and the overall state of the economy. Due to the imminent enrollment increase of middle and high school students advancing through Cherokee County schools, it is now necessary to seek re-approval for the issuance of those bonds to construct replacement campuses for Teasley MS and Dean Rusk MS, as well as to complete other critical infrastructure projects. The proposed $158 Million in new bonds would extend the debt retirement plan by five years. This arrangement allows voters to opt out of using Ed SPLOST to pay off bonded indebtedness and to instead pay these costs through a property tax increase, which is estimated at 4 mills. This property tax increase would not cover the cost of any new building or infrastructure improvements and, due to the availability of no other significant funding source, those projects would all be indefinitely postponed… leading to further critical overcrowding at schools and the implementation of alternatives including redistricting, double sessions, the installation of more portables and other measures traditionally unpopular with parents and the greater community.
MYTH: The Ed SPLOST revenue projections are unrealistic.
REALITY: The School Board uses very conservative revenue projection estimates, and State law requires the inclusion of a cap on the maximum amount of sales tax revenue that can be collected through a local referendum. These projections and estimates are professionally formulated by experts in the local taxation and bond underwriting fields using historical data and economic forecasts. Additionally, the School Board reserves the right, which it has exercised in recent years, to postpone projects and the issuance of related bonds when it appears revenues will not meet projections.
MYTH: Ed SPLOST technology purchases will be obsolete in three to five years.
REALITY: Ed SPLOST funds for technology are used not only for computers, but also for network services, servers, electronic whiteboards, online resources and services, and other investments with significant lifespans, as well as training of employees. Without this funding, Cherokee County students will fall behind their counterparts in both the U.S. and other industrialized nations in terms of technology available to them in the classroom.
MYTH: Holding the Ed SPLOST referendum on Nov. 8, 2011 is not in the best interest of taxpayers.
REALITY: The School Board per State law must wait one year between Ed SPLOST renewal referendums. Should the Ed SPLOST not pass on Nov. 8, 2011, another referendum cannot be held until November 2012; as a result, a millage rate increase will be needed in July 2012 to offset revenue lost after the current Ed SPLOST collection ends. Additionally, it should be noted that Ed SPLOST renewal is not the only issue on the Nov. 8, 2011 ballot.
WHAT CAN BE DONE?
Research the opposition sources: Do they pay school property taxes in Cherokee? Do they have a background in educational financial management, school construction or bond underwriting? Do they have children in our schools? Are they good stewards of their own finances? Do they have political ambitions? Do they cite inaccurate newspaper articles?
Vote “Yes” on Nov. 8, 2011 to the Ed SPLOST renewal, supporting the past decade of success in Cherokee County schools and ensuring it will continue.
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