LAFAYETTE -- The Acalanes school district has filed court papers asking a judge to validate the issuance of $15 million in construction bonds, which will exceed the tax rate promised to voters.
The district's 2008 Measure E ballot language stated that property owners would not pay a higher rate than they were already paying for bonds issued in 2002, but the district recently disclosed that the promised tax rate has already been exceeded this year due to lower-than-anticipated growth in assessed property values.
In 2008, 64 percent of voters approved the $93 million bond measure, which promised that the bonds would be issued "without increasing current (school bond) tax rates" of $35.58 per $100,000 in assessed property value.
The calculation was based on the assumption that property values would grow by 5.75 percent a year after 2008, even though the actual growth rate was only 5.74 percent the year before the election.
Instead, property values declined or grew more slowly than projected, causing the tax rate to jump to $36.10 per $100,000 in 2013-14. The district is projecting the tax rate will rise to about $51 per $100,000 in 2024 if it issues the $15 million in new current interest bonds to complete school improvement projects as planned.
Trustees voted 4-1 last month to do just that, with the understanding that the bonds could not be sold unless a judge agrees that the district can renege on its promise in the ballot language. The district is asking the court to issue an injunction preventing anyone from challenging the validity, issuance and sale of the bonds in the future.
"Because it can be argued that the current bond issuance is not consistent with the Measure E ballot language regarding the estimated tax rate, the district will pursue a validation process through the Superior Court to ensure the legality of the bond sales, and verify that the bonds will be valid and binding," said Board President Kathy Coppersmith in a message to the community posted on the district's website last week.
In court documents, the district is arguing that the tax rate projections included in the ballot materials were estimates that "would not prevent the district from increasing the tax rates as allowed by law if necessary to fund and build approved school facilities."
Any district resident can contest the district's argument by filing an answer to the complaint in court, Superintendent John Nickerson said Wednesday. If that happens, the judge will have to weigh the district's arguments against those of residents who may argue that they voted for Measure E based on the promise in the ballot language.
Lafayette resident Michael Cochrane said he might file a court challenge to hold the district accountable. However, he said he feels conflicted about this, since he believes that now is a good time to sell bonds because interest rates are low.
"They made the promise so people would vote yes, that was the scheme," he said. "Now, they're going back on the promise and aren't really giving us a good reason for why they made the promise in the first place. In 2008 -- and 2010 and 2011 when they sold Capital Appreciation Bonds -- it was very, very obvious to anyone who had a lick of sense that assessed valuations were not going up, they were going down."
To see a message to the community about the Acalanes school board's decision to seek court validation and issue $15 million in bonds, visit www.acalanes.k12.ca.us. Click on Governing Board Message: Measure E Financing.
To see the district's complaint for validation filed in Contra Costa County Superior Court, visit www.contracostatimes.com/education.