Bill allowing school districts to extend bonds for school construction without voter approval advances; Republicans oppose
In 1997, the Legislature allowed school districts to ask voters for approval to issue bonds to help pay for school construction and maintenance for a 10-year period. As that allowance began to expire, the Legislature granted an extension in 2015 that gave school districts the authority to issue general obligation bonds for an additional 10 years, but without going back to the voters for approval.
Six years later, the Legislature is now considering a bill that would again grant school districts the authority to issue general obligation bonds without needing voter approval for a second, additional 10-year period.
As with prior legislation, SB450 allows the school districts to use excess revenues from existing tax rates to fund Pay As You Go capital improvement projects including remodeling and other needed facility improvements. Supporters say the bill will not affect existing debt payments or reserve funds.
“We know our school districts have an ongoing uphill battle to keep their buildings and facilities up to date and in good repair. Anything we can do to help fund these projects without increasing the tax rate is a smart move,” Senate Majority Leader Nicole Cannizzaro (D-Las Vegas) said as she presented the bill to the Senate Committee on Government Affairs on Wednesday. “This measure ensures that our students and staff members are studying and working in buildings that are safe.”
The bill is being fast-tracked through the few remaining days left in the legislative process — it was introduced on Monday, and quickly passed out of committee after its first hearing on Wednesday. The speed of the process irked Republican senators, who voted against the bill and said school districts should have to go back to the voters before extending bonds based on potentially decades-old votes.
“Math in my head is about $15 to $20 billion of spending potential here, we literally just heard the bill, the bill was just dropped,” Sen. Ira Hansen (R-Sparks) said. “With that kind of volume of dollars, I'm exceptionally uncomfortable with supporting a measure like that, and absolutely something of that magnitude, that is all going to be paid for in property taxes by somebody.”
Because voters approved school districts’ bonds at different times, school districts are not on the same schedule, Cannizzaro said. She noted that the Clark County School District is coming to the end of its 2015 bond extension and already has a list of projects ready to go, while adding that rollover bonds must be reviewed by the oversight panels for school facilities, which were set up by the Legislature in 1997.
Clark County School District lobbyist Brad Keating spoke in support of the bill, noting that the bond funding will help rehabilitate and modernize existing schools throughout the Clark County School District.
“Our schools are aging and many remain overcrowded,” Keating said. “The proposed change simply stops the current district's capital rate from decreasing as bonds are paid off well into the future.”
Keating added that older schools in certain areas have to be fully retrofitted because of infrastructure limitations, which leads to gaps in access to digital learning caused by insufficient wiring for internet connectivity and other issues. The Clark County School District made significant budget cuts during the economic downturns, which led to fewer custodians and fewer preventative maintenance projects. The bond bill will allow the district to complete needed repairs and maintenance, he said.
Washoe County School District also supported the bill. District lobbyist Lindsay Anderson said that on average, most schools in Washoe County are more than 43 years old and need to be repaired and replaced to ensure adequate learning environments.
“As we build new schools, keeping our older schools on a level playing field is important to fulfill our commitment to equity and access for our students,” Anderson said. “Currently, the rollover bond proceeds pay for approximately half of our funds to school modernization and revitalization projects. Losing access to these funds would significantly impact our ability to keep up with these projects.”
A lobbyist for the Nevada Chapter of Associated General Contractors, Alexis Motarex, also spoke in support of the measure, which she said would create thousands of jobs and help the state recover from the economic havoc caused by COVID-19.
Sen. Marilyn Dondero Loop (D-Las Vegas) pushed back against Republican opposition, pointing out that more than 25 groups, including Chambers of Commerce and Parent Teacher Associations from across the state, called in support of the bill.
“All those people that called in didn’t just represent themselves, they had to have the OK from their groups,” Dondero Loop said. “So I do think our voters are aware.”