Editor’s note: Katherine Davidson is a 40-year resident of the Cold Spring School District, and she served on its board from 2016 through 2019. She requested that her letter, addressed to the current board, be published in the News-Press.
Cold Spring School District Governing Board Members,
I am writing to you today to express my dismay and alarm that you are considering taking on more debt (in addition to two bond measures that won’t be paid off until 2039) to help pay for a proposed building project. Respectfully, I urge you all to say “No” when this matter comes up for a vote at your Feb. 28, 2022 Special Board meeting.
With the failure of Measure L2020, the constituents that you purport to represent sent a very clear message: no new construction, no new debt. Yet you have forged ahead anyway with your proposed Phase 1 project, committing the taxpayers of the district to at least $1.7 million of taxpayer-funded debt that they do not want and have, in fact, already said “No” to.
I have read (twice!) the district’s 149-page submittal (coldspringschool.net/sites/default/files/files/agendas/SBCEO%20Review%20of%20NVA%20Debt%20%281%29.pdf) to the Santa Barbara County Office of Education and the County Auditor-Controller, reporting the district’s intent to approve a Lease Lease-Back debt instrument to pay a portion of the costs for the proposed Phase 1 project.
Following are comments and questions I have regarding that document. I would appreciate prompt, written responses.
• If the district already has $150K in “hard commitments,” why is it proposing to borrow the full $600K? Why not borrow only $450K and reduce interest costs?
• I understand that the true “Cost of Issuance” would not be known until the Lease Lease-Back debt instrument has been legally entered into, interest rates have been locked in, and fees have been paid. I understand that the estimated COI range is between $25K and $35K and that the District intends to borrow the money to pay those costs.
Then why does the District’s cover letter, its “Disclosure of Non-Voter-Approved Debt District Certification Form,” and its “Disclosure of Non-Voter-Approved Debt” FCMAT form all state that the District intends to borrow $600K? Please explain the discrepancies that occur throughout the submittal documents ($600K? $625K? $635K?) in stating the total debt amount.
• The submittal implies/states that the Cold Spring Foundation has agreed to take on the responsibility of paying off this proposed debt through fundraising efforts.
I wonder if this commitment (about $70K per year for about 10 years) is instead of or in addition to the Foundation’s regular yearly contribution to support the Specialist programs. Please clarify.
• In the event that the Cold Spring Foundation is unable to meet its debt service commitment (wholly or in part), the district has stated that “the debt service payments will be included in the District’s general fund operations” and that it “will make necessary adjustments to the operations to fully fund the debt.”
What operations, specifically, would be subject to “adjustment?” Please clarify how these “necessary adjustments” over the 10 year life of the loan would affect the availability of classroom books, supplies, and materials for our students and teachers; the funding for classroom aides; and salary increases for teachers and staff.
• The District included a contract with Nixon Peabody LLP in its submittal to the County. Included in the firm’s “Scope of Engagement” is the statement that “we understand that MillerCalderon, Inc. will assist the School District with preparation for its election (the “Program Manager”).” Throughout the contract, Nixon Peabody makes many references as to how they would work together with MillerCalderon (the “Program Manager”) as they provide “Bond Counsel Services for 2020 Election.” Taking into consideration Nixon Peabody’s stellar reputation, I doubt they were mistaken in their “understanding” of MillerCalderon’s role.
Given that this contract was entered into and approved by the Governing Board on Feb. 18, 2020 (prior to the November 2020 election) and given that this contract was included — unrevised — in the District’s recent submittal to the County, it is clear that MillerCalderon has been and continues to be intimately involved in the District’s election, financial, and proposed building projects affairs.
Please provide a detailed description of MillerCalderon’s “Scope of Engagement” with the district. Please also provide a copy of the district’s contract with MillerCalderon to provide “Program Manager” services to the District.
• The District has stated, on more than one occasion, that it intends to use remaining Measure C funds (about $147K) to help pay for the proposed Phase 1 project. While I strongly disagree that Measure C funds can be used to pay for new construction, my concern at this point is the fact that the District does not have a fully constituted Measure C Citizens’ Bond Oversight Committee.
I understand that the district’s recent outreach yielded three members — one of which doesn’t even live within the district boundaries. Citizens’ Bond Oversight Committees are legally required to have at least seven members. Our committee doesn’t even have a quorum of that.
And yet, a meeting was held on Sept. 20, 2021 (attended by two lawyers) .and actions were proposed and approved by only three people (www.coldspringschool.net/sites/default/files/Minutes%2009-20-21%20BOC%20Meeting.pdf).
I question the legality of the Committee’s actions on that day, given that it is not fully constituted and therefore a quorum was not present.
It is also important to note that Citizens’ Bond Oversight Committees are governed by the Brown Act (.bondoversight.org/wp-content/uploads/2021/06/Brown-Act-final-6.12.21-Resources.pdf).
What does the district intend to do to attract more members to the Measure C Citizen’s Oversight Committee such that it can be fully constituted?
Thank you, Governing Board Members, for taking the time to read my comments and questions. I look forward to reading your prompt, written responses.
The author lives in Santa Barbara.