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Two-part referendum vote slated for early next year

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Two-part referendum vote slated for early next year
Cloquet Minnesota 122 Avenue C 55720

Cloquet voters will be asked to vote on two separate referendum questions after the new year to help deal with the Cloquet School District’s facilities issues.

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The first question will ask voters to replace the Cloquet Middle School with a new facility that includes an eight-lane swimming pool, at an estimated cost of $47 million. The second question will ask voters to add a new auditorium to the project, raising the total tab to $53.7 million.

To calculate the appropriate amount for a referendum, board members are relying on a survey conducted by Springsted Inc. which indicated 53 percent public support for a building project which does not raise taxes more than $150 per year on a $130,000 home.

The $53.7 million figure would bump the tax load right up to the $150 amount according to figures released by the district on Monday night. Consultant Don Lifto of Springsted addressed the board in a working session prior to the meeting and laid out the case for a two-question ballot. Initial cost estimates to meet all the district’s identified building and maintenance needs were well north of $60 million, so Lifto addressed that head on.

“The usual courses of action when needs exceed feasibility is to either trim the project or split the ballot (into two questions),” Lifto told the board.  “The first question needs to be under the threshold amount and voters need to be given the option to extend it through the second question.”

Superintendent Ken Scarbrough noted that the project had already been trimmed by between $6 million and $10 million by cutting identified needs out to get the total to a figure taxpayers might support.

“We balance the identified needs against those things that the survey indicated the public will strongly support,” Scarbrough said. “There is between six and 10 million dollars cut from the project to get it to the right total.”

The 53 percent support for a $53 million project is within the poll’s margin of error, so getting the final number right is a key consideration.

“What you want to do is make sure you get something,” Lifto told the board. “There are districts who will run two-question referenda to make as sure as they can that they get their core needs met. In this case, that is a new middle school.”

During public comments, one audience member suggested the 20-year period for paying off construction bonds would result in tax increases that would never fall off the ledger once the district moves on to other debt needs in the future.

While noting that the tax burden will increase, “it’s either that or you watch the buildings crumble around you,” Scarbrough said in response.

Discussion centered around whether a pool should be part of the project or whether another taxing entity could help.

“It would be nice if the city would come to the table on this,” board member Dave Battaglia said. “Why are we always the ones who have to do this?”

The final amount, or par amount, the district bonds for the project may be impacted by waiting until after the new year to hold a special election. Lifto told the board that the timetable to submit a full plan to the Minnesota Department of Education and to receive a response would probably be too tight to hold an election in November.

That will probably force the district to put money aside into a Capitalized Investment Fund (CIF), because depending on the timing of bond sales, the first interest payments might be due before levy money is raised to pay it.

Lifto told the board that some districts take money out of their capital funds to put into a CIF and then reimburse the funds from bond revenues, an accounting measure which might reduce or eliminate the need for a CIF.

Timing for an election would then depend on its proximity to other scheduled elections. Placing elections too close together violates state law.

“At that point you would need to consult with counsel to figure out when the best time for an election would be,” Lifto said.

But on the topic of the total amount, one board member said he came around to Lifto’s way of thinking.

“The problem we have in the past is that we build the minimum and then we hear about it from people,” board member Jim Crowley said. “At Churchill we built a gym that was too small, and if we put in an auditorium this time we need to make sure it’s expandable. But I see the wisdom of two questions when I didn’t support that before.”

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