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Helmut Schmidt, Published April 06 2013

Fargo School District may call on voters twice in 2 years

FARGO – Fargo Public Schools officials are juggling the political and budgetary implications of potentially needing to go to voters twice in two years.

Before the end of 2015, the school board hopes to convince voters to sign off on keeping the district’s excess mill levy, preventing state-imposed limits on its property tax rate, said Broc Lietz, the district’s business manager.

But there could also be a vote seeking the OK to build one or more elementary schools, Lietz said.

If voters are asked to sign off on new construction, it would be the first public vote on a Fargo school building project in more than two decades.

The construction decision will lean heavily on two other factors to be decided in coming months:

• The outline of the district’s next 10-year facilities plan;

• How much school funding the Legislature approves this year and what sort of restrictions come with it.

An excess mill levy in North Dakota is the part of a school district’s general fund mill levy above 110 mills. Fargo levies 191 mills, so its excess mill levy is 81 mills. (That may drop if there is property tax relief in the final school funding bill.)

A mill is a property tax rate, expressed as a one-hundredth of a percent. In the district’s budget for the current school year, each mill meant $9 in property tax levied on a $200,000 home, according to district budget documents.

In 2002, voters approved replacing the district’s unlimited general fund mill levy with a cap of 295 mills. A law passed by the North Dakota Legislature in 2009 requires a vote by the end of 2015 to approve a mill levy more than 110 mills.

If voters don’t approve the excess mill levy, the amount of money the district brings in from existing properties would be frozen until, over time, the dollars collected become the equivalent of 110 mills, Lietz said. In the meantime, the district would lose millions of dollars in property tax revenue.

“That 2015 vote is going to be huge,” Superintendent Jeff Schatz said last week during a meeting of school officials and The Forum’s editorial board.

School levy and bond votes in the region are far from slam-dunk propositions.

In part, that’s because those votes need buy-in from more than parents.

Of Fargo School District residents of voting age, just 24 percent have school-age children, Schatz said.

If the school district takes the excess mill levy or construction bonding issues to voters, it will be important to reach out and educate the broader group of district patrons that don’t have an immediate connection to the schools, Schatz said.

Timing will also be important.

“When is the right time to do those two votes if you need to do that?” Lietz said. “There are a lot of variables out there right now.”

There is also some nervousness about how Fargo voters will react.

The last time Fargo School District voters cast ballots on a school building project was in 1991, when they approved adding 11.4 mills to the district’s building fund levy, bringing it to 26.4 mills, and gave a thumbs-up to build Discovery Middle School and Centennial Elementary.

Since then, school boards have used the funds generated by the district’s building fund levy – and at times bonds issued by its Building Authority – to build Bennett, Kennedy and Jefferson elementary schools, Carl Ben Eielson Middle School and Judge Ronald N. Davies High School, as well as several gymnasiums, school additions and a major renovation of Agassiz School.

None of those projects required a public vote.

The board adopted a policy in 2010 to seek a public vote when it wants to finance a building project via its Building Authority, an independent nonprofit that can issue bonds the district can’t without a public vote.

It’s possible the district may have enough cash from its building fund levy to build an elementary school without a public vote, but that could also have some blowback, board member Robin Nelson said.

“If we build a school without a vote, and then we go for an excess mill levy vote, that might not be good for us. Again, it’s a balance of how we do this,” Nelson said.

District officials hope by midsummer to know construction needs for the next decade, Schatz said.

That’s when the next long-range facilities plan is expected to be completed and approved.

Fargo’s public school enrollment is rising again – about 225 more students last fall, Schatz said, with 200 more a year projected for the next five years.

The district’s enrollment was about 10,870 students last week, Schatz said.

The district needs another elementary soon on the south side, and could need another one five years from now, Schatz said.

“Being proactive is better than being reactive. We’re trying to get our ducks in a row,” Schatz said. “With the explosion of population … we don’t have time to wait.”

The district’s Long Range Facility Planning Task Force held its second meeting Thursday. At least two more meetings are scheduled before that group shares its findings with the school board.

After that, at least two meetings are planned to get input from the general public.

Schatz said the coming months will mean a lot of discussions “and sometimes some difficult discussions.”

The task force, school board and district patrons will have to determine the viability of keeping older, smaller neighborhood schools open, and whether they should be repaired, replaced or repurposed.

It will be a matter of balancing the desire for small neighborhood schools, educational needs, and available dollars, Schatz and Lietz said.

“If money was no object, we’d keep every school open,” board member Linda Boyd said.

Readers can reach Forum reporter Helmut Schmidt at (701) 241-5583