Sinking fund levy on May 7 ballot in Gwinn
K.I. SAWYER — The necessity of voters passing a sinking fund tax levy for Gwinn Area Community Schools was detailed at a special “Soup with the Superintendent” event on Tuesday at K.I. Sawyer Elementary School.
On the ballot in a special May 7 election will be a proposal requesting a levy not to exceed 1.75 mills, which is $1.75 on each $1,000 of taxable property value, for 10 years — 2019 to 2028, inclusive — to create a sinking fund for the construction or repair of school buildings, for school security improvements, for the acquisition or upgrades of technology for the purchase of real estate for sites, and other purposes authorized by law.
Superintendent Sandy Petrovich explained the need for the levy, even though the district has been paring down a $406,000 deficit from June 2017.
“Since then, we have been able to come out of that deficit, and at the end of this year, it’s projected that our deficit will be $87,000,” Petrovich said.
This was accomplished, she said, through watchful spending and other means such as grants and a state allowance of $7,861 per student, with the latest enrollment at 1,030 students.
In 2016, voters passed a .95 bond millage for special projects, which Petrovich said provided money up front for the purchase of buses, new roofs at Sawyer and Gilbert elementary schools, interactive teaching panels and Chromebooks for each student.
“So, you may say, ‘Well, we blessed you in 2016. Why do you need more blessings?'” Petrovich said.
The bond money is gone, she said, plus it didn’t give the district money to make repairs, replacements and upgrades.
For example, she noted the pipes for the chemistry classes at the high/middle school are corroded and need to be replaced.
The district also is testing its water supplies to determine if faucets need to be changed because of potential lead content, Petrovich said, plus the district will be required to have a e911-compliant phone system so when it calls emergency services, the specific room location of the phone call can be determined.
That phone system, she said, is estimated to cost $85,000.
“If we have no sinking fund and I have to put a phone system in, then I’m going to be further in the hole with that $85,000,” Petrovich said. “If I lose 10 more kids and lose $78,000 because our enrollment is 10 less next year, then I’m double in the hole and then we continue to dig ourselves in the hole.”
Petrovich called these expenditures “non-negotiables.”
“The hallway tile here at Sawyer is a non-negotiable,” she said. “We can let it fall apart and walk over it. We can put boards in the hall if we have to, but I don’t consider that acceptable.”
Petrovich stressed the district can work its way toward solvency, but it also must make those upgrades.
She said if a home has a taxable value of $50,000, this would equal $87.50 for the tax year, or 24 cents a day, were the sinking fund millage to pass.
The 1.75 mills would provide an estimated revenue of $509,673 per year for 10 years.
“The future of our district really relies on the pennies in your pocket,” Petrovich said.
The district is conducting a special election, which is funded by a grant from the state of Michigan, in May because that would allow revenue to be generated in January 2020, she said — and the needs are urgent.
Petrovich considered what could become “negotiable.”
“I would never take away music in this district, because I’m a former music teacher and can’t do that, but if we got really desperate, we would have to look at what our current expenses are — what are we spending money on? — and we would have to make those adjustments somewhere,” Petrovich said.
A fact sheet distributed to audience members explained the difference between a bond and a sinking fund. A bond is a lump-sum dollar amount the district borrows, through the sale of bonds, to fund capital projects, with taxpayers paying back the money over a period of years with interest.
A sinking fund millage is considered a “pay-as-you-go” method for addressing smaller building remodeling projects and repair needs. The tax is levied each year, with the amount used to make the most urgent repairs and improvements.
Petrovich said it was easy to notice the new district courts, which were funded through the bond millage.
“You don’t see the behind-the-scenes ventilators or other pieces, the classroom thermostats and those kinds of things, that need to be replaced,” she said.
GACS Board of Education President Ashley Jenema reiterated the need for reducing the deficit.
“We can’t pass a budget if it’s not a balanced budget,” Jenema said.
Another “Soup with the Superintendent” event will take place at 5:30 p.m. Tuesday at Sands Township Hall.