Bond for SB's new elementary school: how much will it cost me?

South Bend School District is proposing a $4.95 million dollar bond initiative to voters this April 24, 2018.  Revenue from the bond, in conjunction with over $11 million from the state, will provide the needed funds to construct a new elementary school, replacing the almost 70 year old Chauncey Davis Elementary building.

As a property owner here in South Bend, I am sensitive to factors impacting my property taxes.  I like to have a good idea about how my property taxes are affected by different tax drivers and how my tax dollars are used.  Knowing that all taxpayers have similar concerns, one of the first things I studied about our bond proposal was how it would impact the yearly tax bill. 

Not surprisingly, I have had others ask the same question.  That is, "How much will the new bond impact my taxes?"

Though needed, the thought of building a $16 million dollar school in South Bend, or any other small community, is a tough option to consider.  However, two unusual circumstances make the decision much simpler and more affordable for South Bend voters:

1.  The state is providing over $11 million dollars of the total cost, about 70% all-in-all; and,

2.  The state legislature changed the school levy law last July, which will dramatically decrease the South Bend tax burden beginning in 2019.

These circumstances set up South Bend taxpayers with the opportunity to approve a bond that will build a brand new elementary school, and in doing so still SAVE an approximate $1.44 per $1,000 for the new bond and M&O compared to what taxpayers are paying for the current school bond and M&O.    

Below is the math comparing current and new bond & levy rates:

If you want a little more explanation, read on...

You see, the bond South Bend overwhelmingly approved back in 2007 (paid off in 2020) currently costs taxpayers $1.00 per $1,000.  The new bond for the elementary school is projected to add just $.81 cents to that amount.  This means taxpayers would pay a projected $1.81 per $1,000 of assessed property values.  The $1.81 would replace the current $1.00 per thousand, and is not an additional amount.  The bond rate is projected to be $1.81 for the duration, which is paid back over 20 years.

For some local perspective, South Bend's new bond rate will be lower than the current rates paid by Raymond and Willapa Valley:

The current school levy that voters overwhelmingly approved in 2016 currently costs South Bend taxpayers $3.75 per $1,000 assessed property value.  Because the state changed the school levy law last July, this rate will DROP to $1.50 per $1,000 beginning January, 2019.  The combined new rate that includes the new bond and reduced levy will be $1.44 LESS than our current combined rates.  

So as an example, a $100,000 home is currently paying about $475 dollars a year for the current school bond and local levy.  If the new bond for the elementary school passes, beginning in 2019 that same $100,000 home will only pay $331 for the bond and local levy, a drop of $144.

Another thing to remember is that tax rates are based on assessed property values and will fluctuate as property values change.  Historically, property values tend to go up over time, which means the tax rates go down.  As more people build homes in the school district, as properties increase in value, the tax burden is shared by all property owners driving rates down.

If anyone has questions about the tax rates and costs of the proposed school bond, please contact Superintendent Jon Tienhaara at jtienhaa@southbendschools.org.