Bond could raise I&S tax rate to maximum of $0.50 per $100 valuation
Salado ISD Trustees are set to call for a $49.4 million bond election during their 6 p.m. Feb. 12 meeting at the Salado Civic Center.
School trustees met in workshop session Feb. 5 to discuss a $51.7 million recommendation by the Long Range Facilities Planning committee.
The board opted to put a $49.4 million measure on the agenda for Feb.12 in order to call for a bond that is within the projected financial capacity of the district to retire.
Trustees discussed at length whether they should call for the larger $51.7 million bond, which would require a portion of the bond to be issued at a later date, when net taxable values grow to the point that the district can retire the larger debt.
This may have meant putting off some of the items on the list for up to eight years, depending upon the actual bid cost for construction.
When trustees meet Feb. 12 they will consider calling for a May 5 bond election for $49.4 million for the construction of a new middle school at the Williams Rd. location, the construction of a corridor connecting the addition and gym at Thomas Arnold to the main building and the expansion, improvement and construction of new athletic facilities.
The capacity of the Middle School for sixth through eighth graders is estimated at 584 students with a core capacity of 680+ students to allow for future classroom additions.
The estimated cost is $800,000 for the safety corridor at Thomas Arnold Elementary, bringing the cost for those safety issues and the construction of a new middle school to $42 million.
This will leave an estimated $7.4 million for the construction of new athletic facilities and improvements to the football stadium
Improvements and expansion of the football stadium will include the addition of 1,000 seats, new restrooms and concessions, drainage improvements and a new turf surface at an estimated cost of $3.4 million.
The remaining $4 million will be used for the construction of a new baseball and softball complex on the Williams Rd. location, as well as practice fields for football, soccer and track field events.
Lance Melton with Huckabee, Inc. told trustees that the cost esimate for construction of the new baseball and softball fields with 500 seating capacity at each was $1.45 million. The cost estimate to put turf on the fields was $1.5 million, he said.
Adding other athletic facilities, to include the practice fields, field events facilities brought the cost estimate to $5.125 million. What he termed as soft costs brought the initial estimate to $6 million.
The LRFP committee recommended construction of athletic facilities at the Williams Rd. location as the first phase in moving all of the athletic facilities there. In a later phase, the football stadium could be built at the Williams Rd. location.
The financial capacity of the district is based upon several factors, including the state cap of $0.50 per $100 evaluation for debt service taxes (I&S), taxable property values in the district, interest rate for the bonds and interest earnings from investing the bond money prior to and during the construction phase of the program.
Southwest Securities created a proforma for the district to help it determine its bond financial capacity. Based upon a bond interest rate of 4.25 percent, a 30-year payout and property growth of 4.5 percent over the first 10 years of the bond, Southwest Securities determined that the maximum amount that could be retired at the debt tax rate cap of $0.50 per $100 evaluation is $49.4 million.
The current net taxable property value of Salado ISD is $637,590,852. In 10 years, the net taxable property values are estimated in the proforma to be $990,159,097.
The proforma estimates that the property values will increase by 3 percent per year for years 11-15 and then by 1 percent per year for the remaining 15 years of the bond. Total debt paid on the bond in its lifetime will be $ $114,188,413.