Colorado Springs School District 11 bonds for school buildings and lease debt payoff

Colorado Springs School District 11 would borrow up to $775 million by selling general obligation bonds in one or more series. It would repay them with a property tax levied "WITHOUT LIMITATION AS TO RATE", capped at $49.8 million annually and $1.48 billion in total repayment, and only in the amount needed to pay principal, premium and interest on the debt or any refunding debt, or to build a reserve for those payments. The board's Resolution 2027-02 lets the district borrow "at any one time, or from time to time," and says no lapse of time exhausts that authority. The district's August bond FAQ says it anticipates repayment over about 25 to 30 years, with rates and maturities set when bonds are sold. The district could collect and spend the bond and tax revenue, and any investment earnings on it, as a voter-approved revenue change under the Taxpayer's Bill of Rights (TABOR) and any other law.

The same FAQ estimates the cost for the average homeowner at about $252 a year, and the district's August fact sheet puts it at about $264; both say the amount depends on each property's value.

The question's stated purpose is "PROVIDING CAPITAL IMPROVEMENTS FOR DISTRICT PURPOSES, INCLUDING BUT NOT LIMITED TO", and the first item it lists is "ATTRACTING AND RETAINING HIGH-QUALITY TEACHERS BY INCREASING SALARIES WITH MONEY SAVED BY ACQUIRING ENCUMBERED FACILITIES THROUGH EXERCISING THE DISTRICT'S OPTION TO PREPAY ANY LEASE PURCHASE FINANCINGS".

The district's lease-purchase financings are certificates of participation. The Gazette reported in July that they do not require voter approval and "act as a lease obligation with existing funds", and that D11 used them for the first phase of Palmer High School's renovation, totaling $100 million. The final bond project list sets aside $114 million to pay off certificate debt. The question names no payoff amount, and its purposes also include "ANY CAPITAL ASSETS AUTHORIZED BY LAW". It requires an independent, board-appointed citizens' oversight committee to confirm that spending goes only to voter-approved projects, with no money going to administrator salaries.

District voters approved mill levy overrides in 2000 and 2017, and both questions list competitive salaries and benefits for teachers and support staff among their uses. The 2017 question raised taxes $42 million a year, adjusted for inflation from 2019 on, and also listed "REDUCING LONG-TERM INTEREST COSTS BY PAYING OFF EXISTING DEBT SOONER". With the board's yearly inflation increases, the adopted budget puts that override at $56,821,704 for 2026.

The board's Resolution 2027-03, adopted 7-0 on August 5, says the district uses a portion of its override revenue to pay debt service on the certificates. If voters approve the bond, the board commits that the override revenue "no longer required for payment of the District's Certificates of Participation debt service shall be budgeted for teacher compensation, subject to annual appropriation by the Board of Education and applicable law." The district would keep collecting the override revenue, and the board would budget the portion freed from certificate debt service for teacher pay. The resolution says bond proceeds will not pay salaries and that nothing in it creates "a contractual right to compensation," appropriates money or limits the board's authority over budgets and pay.

In May, board member Parth Melpakam told KRDO the district intended a $10,000 raise for every teacher, from first-year educators to those with 30 years of experience. Resolution 2027-03, adopted in August, names no raise amount. KRDO reported that teacher pay was a point of contention that led to a one-day teacher strike the previous October.

The FAQ says the average D11 school building is about 58 years old and that every school would receive at least $1 million. Among the largest building items on the final list are $150 million for a new gymnasium and athletics building at Palmer, $72.5 million for a new Holmes Middle School building, and mechanical, electrical and plumbing work at Doherty ($40 million) and Coronado ($25 million). The list also carries $75 million for inflation from 2026 to 2035.

The FAQ says D11 has not passed a school bond in more than 20 years. In 2021 a $350 million bond, Ballot Issue 4B, failed 27,476 votes to 27,465 in El Paso County's certified recount.

The board referred this question 6-1 on August 5. Board secretary Michelle Ruehl, who voted no, asked whether large building investments would lift academic achievement while enrollment has fallen and schools run at low capacity, The Gazette reported.