Vote no on issue #6, part 2 – the NRI deal

Published October 19, 2018 by justicewg

Three signs #6The school is trying to complete a negotiation with NRI that could accelerate the tax payments from the Yard, to the point where the boost in tax money may becomes as much as 50% of the cost of the bond the board needs to build a new middle school. Why should voters pass the present levy, when we could have a significantly smaller one via waiting until the negotiations are finished?

The deal

Early in 2018, the school board started negotiation with NRI over increasing the rate of tax money coming from the Grandview Yard development. The board had almost completed the facility meetings, and had set themselves a goal of building a new middle school – the only uncompleted work was the finance committee recommendation to increase the already high $50 million plan from Culp up to a $55 million plan with the extra connector between the schools.

The board was also fully aware of the objections to the new school plan by the G4G group. That unprecedented group spelled levy doom for board members who were not living in a fantasy world. Normal, uncontroversial levies have only passed with 60% yes votes in the past, an opposition group insured failure of the levy (and the two additional NO on #6 groups are the nails in the levy coffin).

I’m of two minds over the board’s attempt to cut a new deal with NRI. Was it just an amateurish mistake to attempt to renegotiate taxes with NRI. and pass the bond at the same time? Even the slowest members on the board must have known they were shooting themselves in the feet with the uncertainty added by the NRI deal. I also think it might have been a desperation move by the board, they knew they would fail in the levy attempt, so they wanted to have some way to win – even if it was by completing a deal that would be bad for both the the school and the city. As long as they got some money, they could claim victory, as long as THEY were the ones who got some money out of NRI..

Whatever the motivation, we now have a deal in progress that might bring substantial money from Grandview Yard, well ahead of past deals. Lets look at what the Mayor said about the deal.

The Mayor and the council

Before the quotes from the Mayor, to be clear – he supports the school levy, So do all the council members who have been asked. They support it because:

It is a normal thing for the board and the council to support each other when they have a levy on the ballot. This is standard mutual support – it is what good politicians do *.

And the council will be asking for new tax money for a new city hall next May. They want the school levy issue completed so they are not both asking for new taxes at the same time.

The mayor speaks

How much additional money will (the NRI deal) mean to the school?
There are some initial estimates using various assumptions, but I do not want to speculate until we have an agreement. I believe we are close. It should be recognized that until recently the City and School have estimated only the dollars coming to the school of what is actually built. We both are fiscally conservative. Those figures indicated that the school would receive about $60 million over the next 20 years. For a long time, this was the figured used. We now have more information on what is being proposed in the current project, which would bring an estimated additional $18 million, or $78 million total to the school. Add to this the development to the south of Goodale and modified school compensation agreement and that figure could almost double. – Mayor DeGraw

Re-read that last sentence for the most important news. The school might be getting $78 million, through modifying the TIF agreement. But the additional taxes that might come from the construction of new buildings south of Goodale could be another boost, up to $156 million total.

This is the most important question – why are we being asked to pass a high levy by the board, when they are on the verge of receiving news that could completely change the financial position of the school?

Committee for Grandview Heights Schools pamphlet

The Pro-levy committee sent a brochure out to every home in the city, answering questions about the levy. What do they say about the NRI deal, in a bullet point section?

The need is now, and at this point no agreement has been reached with NRI.

OK, most taxpayers want to know what they are getting into, and can wait a year for a deal to be completed. What is the rush? Are their bulldozers sitting near the middle school, ready to start the demolition?

The NRI deal could reduced costs to residents by 50% , but could never cover the entire costs

So what? If my income might go up by 50%, I sure would want to wait until I know for sure, before I buy a house. Who cares what percentage the NRI deal covers? If it is significant, we should wait.

Delaying the project would result in added costs.

The committee doesn’t have a crystal ball that allows them foolproof projections on cost, but they do have this thing called “history”. The cost of construction went down in 2008, due to recession. “Costs always rise” is not true. Also, income to the school will be rising, because of the additional tax money from the Yard (tax money that was negotiated in the past, not the current deal). Everyone with any financial skills at all should be shouting “STOP, do not sign contracts for construction when your income is in flux”.

Waiting until the NRI deal is reached would not change the ballot millage, however, it would reduce the taxes the school could collect from residents.

I think the brain power of this committee just completely gave out at this point in the brochure. That talking point is one that belongs to the anti-levy groups, the important issue is the tax rates we are going to pay. If the need for operation millage is going down, we should wait until the financial position of the school is clear.

Implied in the statement “no change in the ballot millage” (I think they mean to say bond millage) is a threat – pass this levy, or we will come back, over and over, asking for the same amount. We will never listen to critics and cut the size of the school facility plan. That threat supports the need to vote the current board out of office.

Part three of my “reasons to vote no on issue #6” will be covering the effects of high taxes on the community, and how the board has failed to make obvious moves that could have protected fixed income and lower income residents.

The YT information session

In past years, the school used to hold public meetings before levies, and would answer questions from the community. I just read the following from the school:

Superintendent Culp and Treasurer Collier are holding an online Community Conversation on Monday, October 22 from 6:30-7:30 p.m. They will be at the YouTube feed at  https://www.youtube.com/channel/UCvM52He47uyzfX0bnjSsz-w.

The superintendent is so deep in the bunker, he can only answer pre-screened questions on YT? For one hour?

(Later) The YT session had “technical issues” and started late, and probably lost all the viewers. They only answered questions that were the softest of the softballs – for 26 minutes. There was one answer that was important, to a question about what the board will do when the levy fails. Will the board do some self examination, and rethink the $55 million plan? Or ignore all the critics, and start plans to cut programs at the schools? Spoiler – Culp only talks about the latter. More on this later.

Previously – Reasons to vote no on the levy, part 1 – The Grandview Heights school board is not trustworthy

Some comments on following Ohio laws on open meetings

The following is not important for the levy debate, but it is more fuel for those who can see how poorly the school board follows state laws on open meetings.

Back in August 2018, I noticed the school had listed an executive session with unnamed “political subdivisions respecting requests for economic development assistance.” I checked with the city – no meeting were scheduled with the city of Grandview Heights.

I sent an email to Culp, and pointed out that the laws of Ohio on open meetings don’t allow the board to hold closed meetings unless some strict rules are followed. I requested for the board to open the meeting, and requested to attend. Culp answered with this quote:

The open meetings act, which is set forth in Section 121.22 of the Ohio Revised Code does permit a board of education to enter into executive session for the purpose of negotiations with other political subdivisions regarding requests for economic development assistance.  This is contained in Ohio Revised Code 121.22(G)(8).  Additionally, your email below states that you would like the Board to “reclassify” the meeting so the public can attend.  While the Board will not be conducting any business other than the executive session, you are, of course, welcome to attend the beginning of the meeting prior to the start of the executive session. – Andy Culp, 8-17-2018

How generous of Mr Culp – I am invited to attend a meeting which has one item on the agenda, a closed executive session.

I sent an email in reply to Culp, asking these questions.

Did the board follow the rules of the ORC (of 121.22(G)(8) ?

Did the school board make an unanimous roll call vote in order to protect the investment or expenditure of public funds by the school board?

Did the the board make a motion and vote to hold that executive session, in which they stated which one or more of the approved matters listed in those divisions (of 121.22(G)(8)(a)) are to be considered at the executive session?

Is NRI considered a political subdivision, as required by the ORC?

No answer from Culp on these questions.

Jump forward to the agenda of the Oct 10 board meeting, Culp said this:

“It is hereby found and determined that all formal actions of this Board concerning and relating to the adoption of this Resolution were adopted in an open meeting of this Board, and that all deliberations of this Board and of any of its committees that resulted in such formal action were in meetings open to the public in compliance with all legal requirements, including Ohio Revised Code Section 121.22.”

What? This is a blatant lie, the board never had an open meeting. They denied my request to have an open meeting. They failed to follow the rules of ORC 121.22.

I guess in the bunker the board is living in, “We hearby find” is sufficient to erase failure to follow state laws.

* Normally council members support school levies, and board members support city levies. During the last city levy, I took note – there was no public support from the board, official or as private citizens. Just more dumb moves from a school board that can’t get along with the city.

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