FAQs

School districts are required by state law to ask voters for permission to sell bonds to investors to raise the capital dollars to renovate existing structures or build new structures. Essentially, it’s permission to take out a loan to build, or renovate, and pay the loan back over an extended period of time, much like a family takes out a mortgage loan for their home. The purchaser of a municipal bond is essentially lending money to the bond issuer in exchange for a promise of regular interest payments, usually semi-annually, and the return of the original investment, or “principal”.

ItemThere are many steps that play a part in calling a bond election. Typically, a district performs some type of facility assessment and/or demographic report, then forms a committee of parents, staff members, and community leaders to review the findings. Once data is reviewed, the committee prioritizes the needs of the district and proposes a bond package to present to the school board. The school board then has the option to call for the election. description

Once a school bond election is called, it is placed on the ballot to be voted on by individuals that live within the school district boundaries. A bond is considered passed based on a majority “yes” vote.

Bonding capacity is determined by calculating the revenues generated from a particular tax rate applied to the assessed value of all properties in the issuer’s taxing jurisdiction. As values grow, the revenues generated at the set tax rate increase, which creates more bonding capacity. The issuer will only sell bonds which can be paid for with revenues generated from its value in any given year.

Bonds are taken out or issued when the issuer goes to the public markets and sells the bonds to investors. Once these bonds have been sold to investors, the issuer will then begin to make semi-annual payments on the bonds. The issuer does not make payments on bonds which remain unsold or not issued.

No. The issuer has the option to sell as much or as little as is required to fund any particular project. However, the District will only sell bonds which it can pay for with existing tax revenues. The voted authorization remains usable by the issuer for a period of approximately 10 years.

Yes, school bonds in Texas have the unique ability to access a program through the Texas

Education Agency called the Permanent School Fund (PSF) Bond Guarantee Program. Once

approved, this program guarantees bond payments should the school become unable to make

the payments. By receiving this guarantee of repayment, the bonds receive the highest credit

rating available and unlock access to reduced interest rates. In May 2023, the Internal Revenue

Service took action to increase the capacity limits of the program. Should the bond election

pass, Utopia ISD would apply for and likely receive the PSF guarantee on its bonds.

https://tea.texas.gov/about-tea/news-and-multimedia/news-releases/sboe-news/irs-action-

increases-bond-guarantee-program-capacity

When the issuer sells bonds to investors, it is making a pledge to repay the investors with interest over a period of time. These investors will include a wide range of individuals and companies, who will purchase portions of the bonds until all are sold. Investors in municipal bonds include insurance companies, banks, hedge funds, and individual investors.

School bonds in Texas are repaid through taxes levied on the properties within a school district's service area. The issuer will set a tax rate each year to generate revenues sufficient to make the payments on its bonds.

Bonds are usually sold with a redemption provision, typically ten years, which allows the issuer to refinance the bonds at no penalty for interest cost savings. The issuer can also redeem bonds early at any time with cash on hand to reduce the repayment term.

There is not a statute or law providing a firm 10-year rule; however, there is a presumption of staleness. Set forth below is a general summary of the doctrine of staleness relating to voted authorization to issue bonds: As a threshold matter, the governing body of an issuer is authorized to determine the date of issuance for bonds, following approval by voters, and the governing body's determination is final and conclusive in the absence of arbitrary action or fraud. See, e.g., City of Houston v. McCraw, 113 S.W.2d 1215 (Tex. 1938), and Texas Attorney General Letter Opinion No. 89-094. The Texas Attorney General's public finance division has generally taken the view that voted authorization will not be presumed to be stale until 10 years after the election at which bonds were approved. After 10 years, a presumption may arise that the voted authorization is stale and has been abandoned. However, the determination whether voted authorization is stale and has been abandoned is very fact specific. The AG's presumption of staleness can be rebutted, and the 10-year period extended by a variety of factors, including an issuer's historical record of issuing bonds in increments pursuant to the voted authority.

Yes. Recent research by the Environmental Protection Agency suggests that a school’s physical environment can play a major role in academic performance. Leaky roofs and problems with heating, ventilation and air conditioning systems can trigger a host of health problems – including asthma and allergies – that increase absenteeism and reduce academic performance. Research links key environmental factors to health outcomes and students’ ability to perform.

The process began about 2 years ago when approximately 50 community members, parents, teachers, business owners, and students met during a strategic planning process to set goals for Utopia ISD. One of the topics brought to light was the state of the current facilities. A subcommittee was formed and they met about once a month to discuss what facilities the district currently has and what facilities might be needed in the future, as well as what facilities might need to be remodeled. The committee conducted tours of the current facilities and sought feedback from the community. The committee requested that the Board of Trustees authorize an independent consultant to perform a facilities study. After reviewing the study, evaluating feedback, and much time in discussion the committee proposed a bond to the Board of Trustees. On August 14, 2023, the Board of Trustees voted unanimously to call for a $58 million dollar bond election to be held November 7th, 2023.

Working with Board of Trustees, teachers and administrators from across the district, the facilities planning committee developed a list of requested items to consider for inclusion in a 2023 bond package. Together, they evaluated current facilities, demographics, equipment, and educational spaces.

The first priority for the bond package is construction of a new "Main Building" at an approximate cost of $30 million. The building would replace the current "Main Building" which was originally constructed in 1927.

The additional $28 million is to be used for future projects within the next 10 years. The two primary areas of focus after a new “Main Building” would be construction of a Career and Technical Education facility to house a classroom and agricultural engineering (welding) shop facility and secondly remodeling of the original gymnasium (Old Gym) that was constructed in 1954.

Other district-wide projects have been discussed. However, none of the projects are finalized and will require input from the community, parents, teachers, business owners, and students and finally, careful consideration by the Board of Trustees.

The original “Main Building” was constructed in 1927 and has had five additions. There are several areas of concern.

1) There are three attics above the “Main Building”. The first attic is the original and has been in existence since 1927. The second attic was formed when the new roof was installed. The first original roof began to leak. At that time a new roof was installed above the original roof without removing the original roof. The third attic was formed when the hanging ceiling was installed to accommodate a central air conditioning and heating system. There is no fire detection system in the attic, or a central fire detection system tied to the other buildings on campus. Access to the upper two attics is very limited and access to all attics is dangerous. There are several combustible items in each of the three attics that were apparently left behind when each attic was constructed. The fire department has expressed concern over the safety of the attics and has stated that they will not enter the building to fight a fire because of the unsafe conditions.

2) Wood flooring was installed during construction of the original part of the Main Building. Later the wood floors were removed, and a concrete floor was poured. With each addition to the original Main Building a separate concrete slab was poured. Each of the slabs are cracking and separating from each other. This has created an issue with the stability of the building as well as cracking and breakage of the floor tiles.

3) The mastic used to install the floor tiles and base molding contains asbestos. Therefore, the tile cannot be removed to install new tile prior to an abatement management company removing the original tile, molding, and mastic.

4) There are currently three sewer systems that service the “Main Building”, two of which have drain fields that are under asphalt. A fourth sewer system was abandoned several years ago, but the piping, holding tank, and drain field are still in place. Periodically there is a strong sewage smell in the building.

5) The infrastructure (electrical, sewer, and water) in the Main Building has reached its capacity. Repairs to electrical, sewer, and water is very difficult and typically requires an extensive replacement of components due to the deterioration of the current wiring and piping. Electrical breaker boxes have reached their capacity and do not allow for additional electrical circuits to be added.

6) The Main Building is not ADA compliant. Entrances to classrooms and restrooms are too narrow. Restroom facilities do not meet ADA regulations for wheelchairs.

In summation, the consensus was that it would be better in the long term both economically and functionally to build a new building large enough for some growth rather than coming back in future years and needing an addition or another building. Some of the considerations included:

1) Even though the student population has not grown at a rapid rate, historically there has been some growth and need for additional space. Every ten to fifteen years an expansion has been needed. The Resource Building was constructed in 1996 to move central office, the library, the science lab, and two classrooms to free up space in the main building. In 2010 an elementary building was constructed to house Pre-Kindergarten through fourth grade to free up more space in the main building.

3) The kitchen is designed larger to allow all of the equipment to be inside as well as allowing adequate storage space. Currently the walk-in freezer is outside and there is not enough storage space to accommodate bulk purchasing of food items needed on a daily and weekly basis - serving trays, condiments, flower, sugar, etc. The inability to purchase in larger bulk quantities increases costs. The kitchen size was also increased because the facilities study report specifically noted the current kitchen area is undersized.

4) The new cafetorium is increased to hold 300 people to facilitate awards presentations, plays, banquets, and other community events. The current cafetorium capacity of approximately 150 people limits seating for school wide and community functions.

5) The new stage is planned to be a full-size stage whereas the current stage is much smaller.

6) The classrooms are sized according to TEA standards to hold a full capacity class in each room, whereas the current classrooms are various sizes, but are consistently smaller than TEA standards.

6) Each one of the new classrooms is designed in the same manner as the current elementary classrooms with storage closets and counters with storage underneath whereas the current classrooms do not have any built-in storage

7) A room was added to accommodate functional living instruction whereas currently there is no functional living facilities or classroom available in the district.

8) A room was added for performing arts instruction. The room would be larger than a standard classroom, but not a full-size band hall. It would be large enough to teach music, theatre, or other performing arts.

9) A room was included for Art. Currently Art is taught in a portable building. So, the space for Art is not currently part of the square footage of the main building.

10) Currently the fifth and sixth grade classrooms are in the Resource Building. Those classroom measurements are not part of the main building square footage. Both of those classes would move to the new building. Technology, currently housed in a portable, would be moved to one of the classrooms in the Resource Building.

11) Two science labs are included in the square footage of the new building. The current science lab is in the Resource building and that area is not part of the main building square footage. At the time the Resource building was constructed there was one science teacher for all secondary grade levels. Currently there is a science teacher for high school, one for junior high, and an ag science teacher that instructs veterinary medicine, advanced animals science, equine science, and small animal science, which all require the use of a science lab. The idea is to move the ag science teacher that is teaching those courses to the second classroom in the Resource Building and use the lab that is currently in the Resource Building for those courses. The high school science teacher would be in one science lab in the new building and the junior high science teacher in the other science lab. Each of those two teachers would teach full time in the lab so that the science lab serves as both the classroom and the lab, thus eliminating the need for two rooms for one teacher. The Ag teacher would share the Resource Building science lab with the elementary, allowing the elementary to conduct experiments, as the elementary currently does not have a science lab to utilize.

12) The committee felt it best to plan for the maximum square footage that might be needed and if the Bond was approved, go back to the table for more discussion and additional input from teachers, community members, business owners, parents, kitchen staff, and students for finalization of the plan.

Utopia ISD received a grant from the Texas Workforce Commission to purchase several large pieces of equipment, but the current facility has proved to be too small to accommodate effective use of all the equipment. The electrical capacity of the current facilities is also inadequate for all the equipment. Finally, the current facility does not have enough room to allow for construction of more than one or two small projects.

The current classroom could then be utilized to store cleaning supplies and furniture. Currently cleaning supplies are being stored in the boys dressing room in the “Practice Gym”. The current welding shop could be utilized to perform bus and other vehicle maintenance. The current maintenance shop could be utilized to store the school tractor, lawn mower and other gas operated equipment. Currently there is no place to store the tractor or other fuel operated equipment. It was noted in the state fire marshal’s inspection that these vehicles and any combustibles, like paint and paint thinner must be stored in a separate building or in flame proof cabinets.

The original gymnasium was constructed in 1954. Currently it is used during the two athletic periods to accommodate concurrent practices for girls’ and boys’ sports and by the community for sports club practices.

The gym does not have central air or heat. The dressing rooms and restrooms were virtually abandoned when the new “Competition Gym” was constructed, and their maintenance has been minimal since that time. The water heater was removed, and the propane space heaters were abandoned as they quit working. Currently there is one operable propane heater in the gym to keep pipes from freezing during the winter. The metal halide light fixtures have not been replaced when the ballasts have quit working. The lights are inefficient and costly to replace. The electrical capacity of the gym has reached its capacity.

The goal would be to renovate and upgrade the gym so it can be utilized for elementary physical education classes, tournaments, pep rallies, other school activities and community sports clubs. This would also preserve the competition gym flooring and facilities. Remodeling and upgrades might include central air and heat, remodeling the dressing rooms so they can be used for PE and guest dressing rooms, reinstallation of a hot water system, and possible installation of basketball goals that will accommodate being raised and lowered for all age groups and sizes of students.

This topic was discussed at length by both the committee and the Board of Trustees. Several factors were taken into consideration. The first and primary discussion topic was “voter fatigue” arising from being asked for additional funds every three to five years for projects that could have been planned comprehensively and voted on at one time. The second consideration was inflation. With construction costs rising each month it was a concern that additional time to get bonding approval for future projects would cause a cost increase for each project thus expending additional taxpayer dollars. Another consideration was that every time an election is held it costs the district approximately $10,000. Three or four more bond elections could potential cost upwards of $40,000. In the end both the committee and the Board of Trustees felt that asking for the maximum amount that may be needed to complete all of the projects would be more economical and save the taxpayers the most money. However, it was very clear to both the Board of Trustees and the committee that if the bond were to be approved, all current and future projects would require additional input from community members, parents, business owners, teachers, and students

Without bond money, the district would need to redirect educational funds used for instructional programs and services to fund increased building maintenance costs.

Early Voting is from October 23, 2023, to November 3, 2023.

Election Day is November 7, 2023.