posted by Mike Madison at 8:42 AM /
The Mt. Lebanon School Board is a runaway train wreck of fiscal irresponsibility. That's the conclusion drawn by School Director James Fraasch, who updated his blog last night with a passionate post about the most recent failures among his Board colleagues.
You should read the whole thing for itself, but the key points seem to be these:
As a member of the Republican Party, James hoped that he could join with his fellow Republicans, who hold a majority of Board seats, to bring fiscal sanity to the District. (James doesn't say that the Democrats on the Board were not interested in fiscal responsibility, but that's implicit in his argument. It's clear that the leading Dems on the Board have been big cheerleaders for a high cost high school renovation project.) Unfortunately, on the whole his fellow Republicans have not listened to reason. They are borrowing and taxing and spending in Mt. Lebanon like there is no tomorrow, and like residents won't notice.
He characterizes the District's reaction to President Obama's speech -- an outright ban in the elementary schools, a strong "don't show it message" delivered to teachers in middle and high schools -- as partisan (Republican) politics at its absolute worst. [Update and clarification: James has edited his post to point out that his objection is specifically directed at the Republican Party's nationwide campaign to discourage broadcasting the speech in schools.]
James is staying in his Board position, but he is walking away from his party. He's an Independent now.
Will this draw any reaction or response? Stay tuned.
You should read the whole thing for itself, but the key points seem to be these:
As a member of the Republican Party, James hoped that he could join with his fellow Republicans, who hold a majority of Board seats, to bring fiscal sanity to the District. (James doesn't say that the Democrats on the Board were not interested in fiscal responsibility, but that's implicit in his argument. It's clear that the leading Dems on the Board have been big cheerleaders for a high cost high school renovation project.) Unfortunately, on the whole his fellow Republicans have not listened to reason. They are borrowing and taxing and spending in Mt. Lebanon like there is no tomorrow, and like residents won't notice.
He characterizes the District's reaction to President Obama's speech -- an outright ban in the elementary schools, a strong "don't show it message" delivered to teachers in middle and high schools -- as partisan (Republican) politics at its absolute worst. [Update and clarification: James has edited his post to point out that his objection is specifically directed at the Republican Party's nationwide campaign to discourage broadcasting the speech in schools.]
James is staying in his Board position, but he is walking away from his party. He's an Independent now.
Will this draw any reaction or response? Stay tuned.
Labels: mt. lebanon school board, mt. lebanon school district
8 Comments:
It takes alot of guts to do what James did last night and what he has been doing for the last several months.
While I am in favor of renovations to the high school, its still unclear to me why we are choosing the most expensive option possible, with the most expensive funding options possible.
James and I disagree on many things (sometimes on this forum), but I have always appreciated the fact that he has backed up his positions on the school board with data and sound rationale. Again, I think it has taken guts to stake out the position he has when he has taken shots from both Ds and Rs.
The fact that he is willing to walk away from a party that means a great deal to him, is pretty remarkable too. One of the things I had come to believe about the Republican party was that it stood for fiscal conservatism. I'm not so sure I believe that anymore in this case.
James: good luck and thank you for taking a stand, asking the hard questions, and taking shots from both sides.
I'm just curious - are there any commenters, readers or lurkers (to use Mike's term) on this blog that believe that the Board's past and recent decisions re: the high school project are spot on and who support them 100%? I promise that I won't blast you or argue with you, if you come forward. That is not my intent at all. I'm simply interested in gauging the level of support for these decisions, because I don't see/hear it elsewhere. I guess I hope it's out there.
Last night the Board voted 6-3 to "go to market" with $69MM in Bonds, at such time as is appears prudent. Could be in the next two weeks - or later.
While the face value of the bonds is $69MM, the District looks to capture $72MM+ in proceeds for the project. The Bonds will be marketed as "Premium" bonds which effectively means the District borrows more than the face value of the issue.
There is an additional benefit to the District (besides the extra cash), the "premium" related debt is not subject to the non-electoral debt limit or Act 1 related millage limitations.
Further, the Board's chosen course may result in an additional $3,000,000 of total interest expense over the life of the project, based on the financial advisor's "apple-to-apple" modeling of the debt options available to the District, as discussed at last night's meeting.
So now we know from Mr. Fraasch’s blog that the politics behind the President’s speech not being shown to students was the result of an email campaign to prevent it from being shown. We don’t know if the same mouthpieces driving up the cost of the High School Project conducted the non-public email campaign against the President’s speech. If you want to know who protested the president’s speech in an email campaign you can request all their emails under the Right-to-Know-Law; call the Superintendent’s office for details.
We know the Mt. Lebanon School District has a structural engineer that can reduce the cost of our High School Project by $20 million and the Board decided to borrow $3 million more on the Project, and to spend $1,000,000 in extra interest costs without a completed design or a completed financing plan from the architect, the business manager, or the financial advisor. We know the Board is speculating that interest rates will rise and betting $4,000,000 of our property tax to do that.
The vote to do this was 6-3 with at least 3 Board Members voting “Yes” after stating good reasons to vote “No.“
Further confusion comes from the fact that Board Members take an Oath to uphold the State laws and brazenly vote to evade the State referendum debt-limit.
Why would a Financial Advisor be retained who would advise us to spend $4,000,000 more on a bond issue?
Which Administrator recommended this financial advisor?
Why would any Administrator of the District ever allow a proposal that evades the State referendum debt-limit to come before the Board?
It appears I may have been wrong in my assessment of the Board's decision regarding the debt issuance.
I am gleaning that the total debt service for the financing option selected is not $3.0MM more than the alternative presented. It is $3.2MM more.
I see the issue as a multiple choice question, that the Board got wrong:
What could we do with $3.2MM?
A) Turf and maintain the Turf for 25 years.
B) Hire ~1.5 career teachers.
C) Bring new technology to the District.
D) Enhance our 21st century curriculum.
E) Pay it in interest expense
F) None of the above - leave it with the taxpayers
The Board selected "E"
I am also gleaning that one of the reasons to go with the more expensive offering is that the more and sooner we borrow, the more and sooner revenue is needed to pay off the debt.
Which in turn means we can borrow more and sooner (statutory debt limit is a function of revenue).
And don't forget the "Premium" on the bonds is excluded from the debt limit - more debt limit available and sooner.
I hope I am wrong, yet again.
I'm not sure Mike's question: "Is the Lebo School Board Out of Control?" is the right one. Maybe the question should be-- "Is the Lebo School Board In Control?"
In response to Mr. Taylor, Mr. Celli defends his design by referring to the DeJong Forums and that he's only doing what the community wished for!
He's playing it pretty loose and free with the facts.
On page 11 of the 12/06 DeJong Utilization study I quote the following:
"the following options for proceeding with the high school facility were presented to the community."
A. Renovate existing bldg. $30-50 million
B. New school $110-120 million
C. 50% new/50% reconstruction $80-100 million
D. 25% new/75% reconstruction $60-80 million
"Most participants of the community dialogue support Option C or D, a combination of demolition, renovation and new construction of the existing facility." (Remember these estimates were pre-market collapse and DeJong is a nationally renown expert!)
Technically Celli may be doing what the community asked for, but he's not doing it at the price they were led to believe it would cost. If in 2006 the community were told the C or D projects were to be $115-120 million we'd probably be on a much different path.
Taylor/Rothchild suggest we can still do a C or D project well within $60-100 million. Celli apparently can't and the board seems to have no backbone to stick to those numbers.
Should we stop and start New for $120 million considering Celli's design, or should the board ask him to stick to the numbers from the DeJong study?
These sessions where the projected budget jumps $3 million every time and leave us with lost ballfields, decreased parking and similiar classroom travel distances are getting us nowhere.
Dean Spahr
From Josie Posti's blog, Center Court, concerning the board approving the issuance of $69,000,000 of bonds;
"The funds obtained now at a low interest rate can be used to pay for architects' fees, which are $210,000 per month..."
Can someone please tell me if $210,000 per month is a normal, reasonable fee for achitects to collect on a project such as ours?
This amount seems to me to be excessive!
Joe Wertheim
What many members of the school board and many residents of our community do not seem to realize is that the decisions made about the high school renovation are not actually about money. That $3.2 million we just obligated ourselves to pay is not just $3.2 million in increased taxes, but, tragically, $3.2 million worth of educational resources that will be denied our students. We just threw away the opportunity to add 1.5 full-time teachers to our staff, a change that would have improved the standard of education offered to our students. Instead, we will be trading in those teachers on debt service, something that provides no educational value.
For all the board members reading these words, please do our community a favor: When considering any financial decision, convert the money at stake into full-time teachers and ask whether our students would be better off with the teachers than with whatever else you are considering to do with the money. That way, you'll know what the real stakes are.
Cheers,
Tom
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