Rulffes: New bond program for schools not expected

Poor economic conditions coupled with wariness that the state will appropriate more of its capital funds probably will keep the Clark County School District from seeking voter approval for a new bond program this year, school officials said Wednesday.

The Legislature recently took $25 million in capital projects funds from the district to help meet an $887 million shortfall in the state budget.

With that precedent established, Superintendent Walt Rulffes questioned how the district could sell the public on additional funding for school construction.

"Is this the climate in which we want to go out for a bond when the state will be desperately seeking money?" Rulffes asked at a Clark County School Board workshop.

"Not that we don't want to help in solving the (state's) revenue problem, but on the other hand, you want to tell the public exactly how the money will be spent," he said. "That's the difficult marketing position you have been put in."

The district is running out of money for new capital projects since the 1998 bond program, which generated $4.9 billion for construction and equipment, has expired. The 10-year program paid for 101 new schools, 11 replacement schools and renovations. Five new schools, the last funded with the 1998 bond, are set to open in the fall.

The district still has $486 million generated by the 1998 program. It estimates it will need more than $400 million to cover debt service costs for the next several years because the district's debt obligations are expected to exceed revenue from property, room and real estate transfer taxes, which were the three main sources of revenue for the 1998 bond program.

If the district does pursue a new bond program, voters would be asked to maintain the current property tax rate of $0.5534 cents per $100 of assessed value. Voters would not be asked to approve new taxes on hotel rooms or real estate transfers, which were the sources of revenue that the Legislature took from the district in the recent special session.

The Legislature originally intended to take $25 million in district revenue generated by the government services tax, but the Legislature ultimately decided to appropriate the money from other revenues because of complications arising from the Nevada Plan, which is the equity formula used to determine funding for public schools, Rulffes said.

When district officials organized a relatively small $100 million bond program last year, they said they would not need voter approval because they would be using room and real estate transfer taxes.

These interest-free bonds were related to incentives in the federal stimulus program. Chief Financial Officer Jeff Weiler said the district has so far delayed issuing these bonds because of unfavorable market conditions and complications in federal law.

School Board member Sheila Moulton said she agreed with Rulffes that the district does not need to organize a new bond program for this year. She thinks 2012 might be more realistic.

She said she is worried about infrastructure costs snowballing if the district defers routine maintenance for lack of funds.

While the School Board took no formal action, Board President Terri Janison said after the meeting that she believes the consensus of the board is not to pursue a new bond program.

Contact reporter James Haug at jhaug@ reviewjournal.com or 702-374-7917.