Your Tax Impact
Projected Tax Impact

How would the bond proposal impact my property taxes?

 

If approved by voters, a net debt tax rate decrease is expected for Holt Public Schools property owners. The net debt tax rate is expected to decrease by 1.77 mills from the prior year’s levy.

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Where can I find my property's taxable value?

If you reside in Ingham County, click here.

If you reside in Eaton County, click here.

Select "Current Tax Search" on the top left of the website and enter your address or address range.
Hit "Enter" on the far right side of the page.

Your property will be listed on the following Search Results page. Click on the appropriate property record. Your taxable value is shown at the top right corner of the property Record Details page.

Screenshot of Taxable Value search page.

Financial Information

School funding options – specifically bond proposals – can be complex and challenging to understand. Questions are common: Why use a bond proposal instead of other funding options? How much will it cost? How can the community be confident that the bond funds are used as proposed? Since Holt Public Schools has asked the community to vote on a bond proposal on May 4, 2021, the District developed information to address some common questions.

Bond funds are needed for improvements to school facilities and infrastructure.

In the State of Michigan, the primary funding mechanism for capital improvements in school districts is requesting taxpayer authorization of bond proposals to permit the district to borrow money to pay for capital expenditures.  As a general rule, school districts do not use general fund dollars (also known as the state funding per student) for these types of capital improvements. Doing so would take away money from educational programming and instruction – which is certainly not in the best interest of students. The $148 million bond proposal focuses on four key pillars of safety and security, critical infrastructure, learning environments and innovation.

Bond Pillars

Annual operational needs are funded through federal dollars and an allocation made by the State of Michigan, known as the student foundation allowance.

When Proposal A passed in 1994, the funding system for schools changed. The State of Michigan guarantees a specific amount per student for operational expenses, known as the student foundation allowance. Anything over and above this funding for needed facility and infrastructure improvements would have to be approved by public vote for bond or sinking fund dollars.

 

Holt Public Schools has a $65 million operating budget comprised of State and Federal funding, most of which comes through the foundation allowance for the number of student served. Around 80% of this funding goes to staffing, which is similar to 
most districts. Bond dollars cannot be used for staffing and operational costs.

Bond repayments have interest just as a home mortgage does.

In truth, the interest rates for bonds cannot be determined until the bonds are sold. The bonds in the $148 million bond proposal would be sold in four phases as the work is projected to be completed. A conservative estimate on the interest rate is between 1.50 - 3.90%. Think of selling bonds like purchasing a home. Just like a mortgage, interest on the bond will be incurred. For a home that costs $100,000, you make monthly payments on that amount, plus interest, over a specified number of years. The total amount that you pay once your home is paid off is higher than the initial purchase price – but you still consider the cost of your home to be $100,000. The same is true with bonds. In this proposal the district would sell $148 million in bonds to fund improvements over 8 years.  The school district plans to issue the bonds in four separate series, in 2021, 2023, 2025 and 2027. Each bond series would have a length of 26 years or shorter.

 

Technology and buses are not amortized over 26 years.

Bus purchases are required to be amortized over a 6-year period beginning at the time the buses are put into service. Technology purchases are required to be amortized over a 5-year period beginning at the time of installation. Each bond series has an allowance for future technology purchases and updates.

 

Bond funds cannot be used to pay for salaries or for operational needs.

Voter-approved bond funds can be spent on new construction, additions, remodeling, site improvements, athletic facilities, playgrounds, buses, furnishings, equipment, technology, and other capital needs. Funds raised through the sale of bonds cannot be used on operational expenses such as employee salaries and benefits, school supplies, and textbooks. Bond funds must be kept separate from operating funds and must be audited by an independent auditing firm. If the bond is approved by voters, those dollars can be used for capital improvements instead of using the general fund dollars. Freeing up general fund dollars for operations puts more money in the classroom, with a focus on instruction and programming.

 

The anticipated millage rate is expected to decline over time.

The total projected millage rate over the life of the bond is reflected in the chart below. Beginning in 2021, the millage rate is expected to remain constant at 8.23 until 2028, thereafter it is estimated to decline due to bond repayment and taxable value growth.

Expected Bond Millage Rates
Financial FAQ

What is a bond proposal and how can funds from a bond be spent?

A bond proposal is how a public school district asks its community for authorization to borrow money to pay for capital expenditures. Voter-approved bond funds can be spent on new construction, additions, remodeling, site improvements, athletic facilities, playgrounds, buses, furnishings, equipment, technology, and other capital needs. Funds raised through the sale of bonds cannot be used on operational expenses such as employee salaries and benefits, school supplies, and textbooks. Bond funds must be kept separate from operating funds and must be audited by an independent auditing firm.

How would the bond proposal impact my property taxes?

If approved by voters, a net debt tax rate decrease is expected for Holt Public Schools property owners. The net debt tax rate is expected to decrease by 1.77 mills from the prior year’s levy of 10 mills. The current levy sunsets in 2021, which is collected in 2022.

How much money would the bond proposal generate?

The proposal would generate $148,000,000 which would be spent over ten years on district-wide capital improvements.

 

 

Is the school district going to immediately issue $148 million of bonds?

No. The bonds are proposed to be issued in four series (2021, 2023, 2025 and 2027).

Would the approval of the bond proposal have any impact on our current operational budget?

While funding from this bond proposal is independent of the support the district receives from the State of Michigan for annual operations on a per pupil basis, the bond would likely have a positive impact on the annual operating budget for existing facilities. It would allow the district to reallocate operating funds that are currently being spent on aging facilities, mechanical systems, and technology. The savings generated from new and cost-efficient facilities could be redirected to student programs and resources.

Would money from the bond proposal be used to pay teachers’ salaries and benefits?

 

No. School districts are not allowed to use funds from a bond for operating expenses such as teacher, administrator or employee salaries, routine maintenance, or operating costs. Bond revenue must be kept separate from operating funds and bond revenue expenditures must be audited by an independent auditing firm.

Can you help me understand how bonds fund school district infrastructure and facilities?

In 2018, a Holt Public Schools facilities assessment indicated critical changes were identified for our facilities. We looked at those critical infrastructure issues and the projected decline in student enrollment numbers to determine the scope of this bond proposal. Instead of requesting taxpayers to vote on an extension at 10 mills we are estimating 8.23 mills would be levied, a net decrease of 1.77 mills. If approved, the net decrease to 8.23 mills in 2021 would bring in $148 million to address critical infrastructure upgrades, safety and security, learning environments, and innovation, focusing primarily on elementary schools across the district.

 

When Proposal A passed in 1994, the funding system for schools changed. The State of Michigan guarantees a specific amount per student for operational expenses, known as the student foundation allowance. Anything over and above this funding for facility and infrastructure improvements would have to be approved by public vote for bond or sinking fund dollars.

 

Annually Holt Public Schools has a $65 million budget and nearly 80% of that funding goes to staffing, which is similar to most districts. Because bond dollars cannot be used for staffing and operational costs, if the bond doesn’t pass, we will have a minimal budget to continue addressing aging facilities and will provide little opportunity to enhance any of our learning environments in the near future.

 

Can you please explain the 1.77 debt tax mills net decrease?

Holt Public Schools current levies 10 mills. If approved by voters, the net debt tax rate is expected to decrease by 1.77 mills from the prior year’s levy of 10 mills to 8.23 on the next tax levy in December 2021.

Expected Bond Millage Rates

Is there an estimated increase in the bond millage rate in this bond proposal?

No, the bond millage rate is estimated to decrease by 1.77 net mills (10.00 - 8.23). For a $100,000 market value/$50,000 taxable value home this equates to an estimated decrease of $88.50 per year or $7.38 per month.

Is the bond millage rate estimated to be the same for the entire life of the bond proposal?

No. The bond millage rate is estimated to remain at 8.23 mills through 2028, thereafter it is estimated to decline due to bond repayment and taxable value growth.

Schools are getting a significant amount of COVID-19 relief funds; can these dollars be used for the proposed bond?

COVID-19 funds allocated to local districts from state and federal sources must be used to support school needs due to COVID-19. Documentation from the United States Department of Education shares that the American Rescue Plan Elementary and Secondary School Emergency Relief (ARP ESSER) Fund allocations are to be used to address the immediate needs of schools and districts. These federal funds are given to the State of Michigan to distribute. Each local district must track how these funds are used.

 

The US Department of Education stats the districts may use APR ESSER funds for the following:

 

LEA Use of ARP ESSER Funds

Of the total amount allocated to an LEA from the State’s ARP ESSER award, the LEA must reserve at least 20 percent of funds to address learning loss through the implementation of evidence-based interventions and ensure that those interventions respond to students’ social, emotional, and academic needs and address the disproportionate impact of COVID-19 on underrepresented student subgroups (each major racial and ethnic group, children from low-income families, children with disabilities, English learners, gender, migrant students, students experiencing homelessness, and children and youth in foster care).

 

Remaining LEA funds may be used for a wide range of activities to address needs arising from the coronavirus pandemic, including any activity authorized by the ESEA, the Individuals with Disabilities Education Act (IDEA), Adult Education and Family Literacy Act (AEFLA), or Carl D. Perkins Career and Technical Education Act of 2006 (Perkins CTE). Specifically, ARP ESSER funds may be used to develop strategies and implement public health protocols including, to the greatest extent practicable, policies in line with guidance from the Centers for Disease Control and Prevention (CDC) on reopening and operating schools to effectively maintain the health and safety of students, educators, and other staff, as well as:

  • coordinating preparedness and response efforts with State, local, Tribal, and territorial public health departments to prevent, prepare for, and respond to COVID-19;

  • training and professional development on sanitizing and minimizing the spread of infectious diseases;

  • purchasing supplies to sanitize and clean the LEA’s facilities;

  • repairing and improving school facilities to reduce risk of virus transmission and exposure to environmental health hazards;

  • improving indoor air quality;

  • addressing the needs of children from low-income families, children with disabilities, English learners, racial and ethnic minorities, students experiencing homelessness, and foster care youth;

  • developing and implementing procedures and systems to improve the preparedness and response efforts of LEAs;

  • planning for or implementing activities during long-term closures, including providing meals to eligible students and providing technology for online learning;

  • purchasing educational technology (including hardware, software, connectivity, assistive technology, and adaptive equipment) for students that aids in regular and substantive educational interaction between students and their classroom instructors, including students from low-income families and children with disabilities;

  • providing mental health services and supports, including through the implementation of evidence-based full-service community schools and the hiring of counselors;

  • planning and implementing activities related to summer learning and supplemental after-school programs;

  • addressing learning loss; and

  • other activities that are necessary to maintain operation of and continuity of and services, including continuing to employ existing or hiring new LEA and school staff

 

How would I know the bond funds would be spent the way they are supposed to be spent?

 

Michigan law requires that expenditure of bond proceeds must be audited, and the proceeds cannot be used for repair or maintenance costs, teacher, administrator or employee salaries, or other operating expenses. An audit would be completed at the end of each bond series project to ensure compliance.

What is the independent audit of bond construction funds?

Every bond construction fund is required to have an independent audit, per Bulletin 7, Public Act 451 of 1976 of the Revised School Code, effective May 12, 2014 (revised September 12, 2017). The objective of the audit is to determine if the bond proceeds have been expended in accordance with the stated purposes for which the bonds were authorized.

The audit must be performed by an independent CPA, licensed with the Michigan State Board of Accountancy, and comply with generally accepted auditing standards as adopted by the American Institute of CPAs. A bond construction fund audit report is required after construction is completed as determined by a Certificate of Substantial Completion. This report is for the entire construction period, from the sale of the bond issue or the beginning of the project (whichever is earlier) through completion, and must include all activity in the fund for that period.

 

What is the Michigan Homestead Property Tax Credit?

The Michigan Homestead Property Tax Credit is a method through which some taxpayers can receive a tax credit for an amount of their property tax that exceeds a certain percentage of their household income. This program establishes categories under which homeowners or renters are eligible for a Homestead Property Tax Credit. Please consult your tax provider to determine if you are eligible for this tax credit.

Where can I find ballot language?

For more information regarding ballot language, please see the Voter Info page.