Fiscal Disaster Looming for Texas ISD's Over Border Crisis and Construction

DALLAS, Texas--The Texas legislature House Select Committee is beginning a serious review into the wide reaching costs of the Texas border crisis, Dallas ISD is ready to saddle county residents with more debt to house unaccompanied alien minors in three of its schools, and the Texas border surge costs are estimated to add $1.3 million a week to the taxpayer's tab plus two weeks of $68,000 in incidentals to Hidalgo County. Simultaneously, a report was released by Comptroller Susan Combs office on June 30 that should chill Texans to the bone with the amount of debt that property taxpayers already owe for public school construction between 2007-2013: $64.8 billion.

"Texas Public School Construction" analysis examined new school costs for facilities in adjusted figures to reflect rates of inflation, regional labor and material prices. Although the statewide average came in at $154 per square foot, North Texas public school costs came in higher.

The Dallas Morning News reported, "With 200 schools, North Texas also has the highest number of new campuses, at an average cost of $161 per square foot." Only San Antonio schools cost more.

The comptroller's report also cited the Texas Bond Review Board (BRB) and the Texas Education Agency (TEA), breaking the numbers down to more than $13,000 for every student in a debt-ridden district stating, "The share of all public and charter school expenditures spend on debt repayment -- largely for construction -- has grown from 7.6 percent in the 2002-03 school year to 10.8 percent in 2012-13."

Likewise the sourced TEA data showed service spending jumped 103 percent although enrollment only increased 19 percent.

"School districts can levy a tax up to 50 cents per $100 of a property's value to pay down debt issued for large capital projects such as new schools, renovations, technology and athletics facilities," it stated on the comptroller's website Texas Transparency.

2014 has been a banner year for all of the above expenditures in Texas school bonds. Dallas suburb school district Frisco ISD, passed a whopping $ 775 million bond and Houston area Cypress-Fairbanks ISD, pushed through an astronomical $1.2 billion bondEmpower Texans reported that the tax base of school districts are the collective losers.

In their article, Empower Texans sourced an earlier report from the comptroller, "Your Money and Local Debt" which placed Texas as the second highest holder of local debt in the nation.

Previously, in an April 29 press release, Combs seconded these findings, placing Texas behind New York, according to US Census Bureau data. "Texas public school districts account for the largest share of most property tax bills in Texas."  She cited that 54 percent of that $64.8 billion of all outstanding tax-supported debt issued by local governments.

The comptroller's public school construction report also stated that schools can be built efficiently and less expensively, but districts do not always chose to do so. This is true in districts like Frisco ISD where in the May 2014 bond election grassroots watchdog group Responsible Spending Coalition of Texas implored Frisco ISD taxpayers not to take on an additional $775 million.  When amortized that financial risk ballooned to $1.33 billion. 

The coalition promoted fiscal responsibility, debt management, financial transparency and accountability within ISD's and city government.  They were not against school bonds in the last election either. They were for fiscally-responsible bond packages. Even with a need for more schools in Frisco, the group would have liked to have seen a bond measure that didn't put Frisco property taxpayers into additional risk with overwhelming debt.

The Texas Public Policy Foundation also warned Frisco residents of their outstanding $2.6 billion dollars of existing outstanding principle and interest debt from past district bonds  as Breitbart Texas reported.

Combs' report dinged a few districts for construction costs report claiming the cost comparisons weren't fair.  According to the Dallas Morning News article,  Plano ISD, showed the second most expensive middle school costs in the state. Their Otto Middle School came in at $212 per square foot. However, Plano ISD Superintendent Richard Matkin balked at these findings, claiming that the report listed construction costs for the middle school at $1 million more than actual costs. He told the Dallas Monring News that the square footage cost for Otto at that time was $178.55" which he insisted was in line with other school districts.

The average cost for building Texas middle schools in the report came in at $149 per square foot.  Dallas area middle schools came in higher in 2010 when Otto opened. According to the Dallas Morning News, Cobb Middle School (Frisco ISD) came in at $192 per square foot, Tidwell Middle School (Northwest ISD) was $189, and Everman Baxter Junior High was $150.

The 2007 bond in Sunnyvale ISD was also a vote to "expand from a district that only served kindergarten through eighth grade," according to the Dallas Morning News. First time amenities such as a field house, baseball/softball complex and parking were folded into the taxpayer's bankroll.

"We bid it at the exact wrong time, when construction costs were at an apex in 2008," Sunnyvale ISD superintendent Doug Williams told the Dallas Morning News in their article. He added that community expectations for a high school were high and "we had to meet those expectations" in a town with $281,000 average home value. The Sunnyvale bond vote was for 550 students to have a $25 million high school.  

Combs' also said in the June press release "Currently there is no required standard for reporting school construction costs, so it is extremely difficult for taxpayers to determine how their tax dollars are being spent."

That was a sentiment echoed in April by Responsible Spending Coalition of Texas chief Tom Fabry. He told Breitbart Texas that they also would have liked if the Frisco ISD measure had been more transparent so that voters understood what are the actual costs in a bond measure.

Breitbart Texas also reported on the way that Frisco ISD structured past bond measures, resulting in funds being diverted for other projects, even ones that voters may not have approved or even voted on. In the 2006 district bond package there was no reference to building or funding the $27 million Frisco ISD administration center that was constructed in place of budgeted elementary schools.

Ironically, despite their exorbitant May 2014 school bond, the comptroller used Cypress-Fairbanks as an example of a fast-growing district to use money saving architectural elementary, middle or high school prototypes that also save months of construction time.

Cy-Fair ISD superintendent Mark Henry responded to the comptroller's praise. He said, "We are honored to be recognized...as it validates what we have felt all along: Cypress-Fairbanks ISD is fiscally responsible with taxpayer dollars," according to the June 30 press release.

However, Empower Texans'  two-part series on the Education Debt Industrial Complex signaled otherwise, explaining that these expenditures may not even benefit students. "Typically, these new-debt dollars are spent on new facilities that rival state universities and Fortune 500 companies in their opulence."

Additionally, they examined the larger issues of how the bonds become so bloated in the first place including firms that cater to new construction, equipment, technology, or services that gave over half of the $109,410.01 in contributions to the Say Yes to CFISD Kids PAC.

They even reported that law firms participated in the school district project bidding process, donating heavily to pro-bond PACs in both Frisco ISD and Cy-Fair ISD. Then there's the Fast Growth School Coalition, which Empower Texas called an "unholy alliance of pro-debt special interests, school administrators, and taxpayer-funded lobbyists that stand ready to feed from the ISD bond money trough." Fast Growth's stated purpose is to substantially increase spending on school facilities and repeal the few debt and tax limits set on ISDs by Texas law, according to Empower Texas.

So while Cy-Fair's superintendent was quick to state that "taypayers deserve to know how we are spending their money," it still begs the issue of how much money and what are those actual costs over time to the taxpayer.

The comptroller launched the database that detailed school new construction costs since 2007 in late April. It was created as an way for Texans to better understand the $6.7 billion of proposed bond debt on the May 2014 ballots, 92 percent of which was proposed by local school boards.

Combs commented, "Texas rapid growth has brought tens of thousands of new school-aged children to our state, leading to huge expenses for school construction — more than $14 billion in the past seven years."

She reminded taxpayers that there was no legislative standard for these costs and no required reporting mechanism. Her intention in reporting this information was to shine a light on the spending and hold local officials accountable for it.

Despite Combs' efforts, it didn't stop voters from adding double-digits of debt to their tax bills. Come Fall, all the construction and technology costs owed for the prized 21st Century learning may not be the only pain Texans feel.  It could well be compounded by the preliminary $8.5 billion to educate undocumented school aged youth that crossed over into the Texas border illegally.  Only time will tell if that estimated figure is low.

Follow Merrill Hope on Twitter @OutOfTheBoxMom.


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