As second referendum nears, Grand Forks school leaders outline need for mill levy increase
Voter approval of a 10-mill increase for district's building fund would provide $2.5 million annually for facility needs.
After a failed June referendum, Grand Forks school administrators are hopeful a second attempt to boost the mill levy for the maintenance and repairs of school buildings will be successful.
Because a “no” vote this time around, on Sept. 28, would push the district deeper down the hole of seemingly constant maintenance and infrastructure needs in its school buildings, school leaders say.
A special election seeking voter approval of an increase in the mill levy – from 10 to 20 mills – for the district’s building fund will take place from 7 a.m. to 7 p.m. Sept. 28 at the Alerus Center. This election follows a June 22 referendum that asked voters for that 10-mill increase, as well as approval for an $86 million bond issue that included about $64 million for a new K-8 school, which would have meant closing and consolidating several north-end schools.
After it was soundly defeated in June, the proposal for the new K-8 school has been removed from the ballot; what remains is the district's plan to raise mills to pay for improvements at public schools across the community – the more favorable of the two choices, according to the final June election results.
Posing two questions on the June 22 ballot “really led to some confusion,” Eric Lunn, School Board president, said at a recent meeting with the Herald editorial board. “There were people that were obviously very opposed to a K-8 school and that amount of money.”
Presenting a single question should make it “clearer for a voter to understand,” Lunn said
Superintendent Terry Brenner said, “We’re pretty pleased with the results we got with question 2 ....” That question received a 54% favorable vote, but fell short of the 60% needed to pass.
“That kind of told us that maybe we should bring this back to the public – given the percentage rate -- so that’s why we’re bringing it back soon,” he said.
If voters approve the Sept. 28 referendum, the monthly tax impact for the owner of a home valued at $100,000 would be $3.75, or $45 annually. The monthly tax impact for the owner of a commercial property valued at $100,000, would be $4.17, or $50 annually.
Additional millions annually
Voter approval of the mill levy increase, to the maximum allowable 20 mills, will generate about $2.5 million in property tax annually for the building fund, Brenner said. That amount “isn’t going to catch us up, but it’s going to at least allow us to reset and move forward.”
“We have an immense amount of deferred maintenance,” said Chris Arnold, the district’s buildings and grounds director. “The list continues to get longer each week. … The need remains and, in fact, gets stronger as we continue to defer longer.”
Arnold recently presented an extensive list of maintenance needs, totaling $260.9 million, in a report to a joint meeting of the City Council and the School Board.
His biggest concern, in planning to address issues, is accounting for inflation “and the longer we push things out into the future, the more these things are going to cost us money, which then gets tipped by more emergencies, etc.,” Arnold said.
Many of the district’s buildings were built before laws, such as those related to special education or handicapped accessibility, were in place, said Scott Berge, the district’s business manager. Accessibility and other improvements, such as mass notification and sprinkler systems, represent “about $30, 40, 50 million of work that’s not deferred maintenance; it’s really just bringing things up to modern standards that didn’t exist at the time the buildings were constructed,” Berge said.
The average age of school buildings is 54 years, Brenner said.
Arnold and his team are working on a plan to address deferred maintenance, placing projects on a long-term timeline, Arnold said. “We want to have a 10- and 15-year outlook.”
“What we’re trying to do, ultimately, is dig ourselves out of this hole, and then keep ourselves out of the hole,” he said.
With the recurrence of catastrophic infrastructure and equipment repairs, over the past six years, the district has been forced to draw about $11.5 million from its general fund, which should be dedicated instead to student programs, learning materials and competitive compensation to attract and retain high-quality employees, administrators say.
“Mr. Arnold and his staff are doing a lot of work in our buildings on a daily basis,” Berge said. “It’s these very large significant projects that, partially with the much lower mill levy that we’ve had over the last decade plus, hasn’t really allowed for some of that work to (be done).
“We’ve got a very detailed project list. It’s really that funding mechanism strategically over the next 10, 15, 20 years. That’s what we need to take care of our facility needs.”
The district has obtained some financial relief from the government in the wake of the pandemic, through the federal Elementary and Secondary School Education Relief Fund, Brenner said.
“While the 10 mills (increase) is critical, the ESSER dollars have been a lifesaver,” he said. “A bit of a lifeline for us, really, going forward.”
Among other effects, the pandemic has highlighted the importance of indoor air quality, Brenner said. It has revealed that many schools’ HVAC systems are incapable of meeting current indoor air quality standards, including introduction of fresh air, proper filtration and air conditioning.
Low mill levy rate
District administrators are emphasizing the relatively small number of mills Grand Forks levies for its building and sinking funds, compared to other large school districts in the state.
Lowest among the five districts, Grand Forks, at 12 mills, levies about half the mills than the next-lowest district, Minot at 23.5, does, Berge said. The corresponding revenue from that levy amounts to $2.8 million for Grand Forks, $4.9 million for Minot, $10.7 million for Fargo, $15.7 million for Bismarck, and $19.9 million for West Fargo.
The Grand Forks district also receives the smallest percentage of property tax, 31%, compared to those other four districts. Others range from 40% in Minot to 53% in Fargo. A 10-mill increase in the levy for the building fund would boost that percentage by about two points, Berge said.
In this challenging financial situation, the district has taken steps to cut expenditures and increase revenue, Brenner said. For example, in a budget reduction exercise last year, $4 million was trimmed, although the target established by the board’s Finance Committee was $4.4 million. The target for a second round of budget reduction, affecting the 2022-23 fiscal year, has not yet been set by that committee, he said.
Grant-writing in the past two years has brought in more than $6 million, but funds are earmarked for specific purposes, such as learning loss and acceleration, Brenner said.
Support for the proposed increase in the mill levy has come from various sectors. The Grand Forks Region Economic Development Corporation and the Chamber of Grand Forks and East Grand Forks have endorsed it.
Prior to June, the school district had not placed a referendum before voters for nearly 30 years. If this referendum does not pass, funds will continue to be drawn from the general fund for facility needs, and that’s going to affect people and programs, Lunn said
Historically, “this community has stepped up for kids for a long time, and I think the people understand,” he said. “The only concern I have is just the timing with COVID and jobs and all the stuff that’s going on in everybody’s life. But we don’t have the ability to wait another year or two or three, because the longer we delay this, the more this is going to affect programs and the quality of education.”
“One of the reasons my wife and I settled here in 1987, after medical school,” Lunn said, “was we love the community, because it was so kid-oriented, and I don’t think it’s changed since then.”
The polls will be open from 7 a.m. to 7 p.m. Sept. 28 at the Alerus Center, 1200 S. 42nd St.
Absentee voter applications are available at the Mark Sanford Center, 2400 47th Ave. S., and at the Grand Forks County Office Building, 151 S. Fourth St. Suite 10. Voters may also call Grand Forks County at (701) 780-8200 or Grand Forks Public Schools at (701) 746-2200 (ask for Scott Berge, business manager) to request an application.
The application can also be found at https://www.nd.gov/eforms/Doc/sfn51468.pdf .
Absentee ballots must be postmarked by Sept. 27.
The Grand Forks school district is inviting the public to take a guided tour at any of the schools in Grand Forks on Thursday, Sept. 23. Tours, led by each school principal, will begin at 5:30 and 6:30 p.m. Principals will highlight some of the barriers to 20th Century learning in their facilities.
Voters are encouraged to view a 13-minute presentation about the district’s facilities and budget, and the upcoming election, at https://www.youtube.com/watch?v+MVH2cBmp8D0 .
For more information on the 10-mill special election, go to www.gfschools.org/referendum . A calculator that can show the specific tax impact, based on property value, is available at this website. In the right column, under “Links,” click on “Tax Information.”