Bond Oversight Committee Provides Neither Oversight nor Independence from the District

Bond Oversight Committee rubberstamps
district bond spending & does not represent citizens

The law requires that school bonds have an independent oversight committee
composed of citizens. The “independent oversight” the law requires to oversee
school bond spending has failed to reign in the District’s wasteful spending, as
seen in the Measure H Bond ledgers for 2015-16, 2016-17, 2017-18.
Our Measure H (2014) bond funds are being spent on lavish niceties for some
schools like the Wilcox $380,000 stadium sound system, as well as on salaries,
benefits and pensions. Bottled water, cell phones, cable internet, lunches,
conferences, and travel are also being billed to our bond monies. Taxpayers
have paid over $3,000,000 for design work to an architectural firm that is a
bond campaign donor (to Measure H and to Measure BB, including providing
facilities for phone banking), $75,000 a year to a contractor towater 20 trees,
and almost a million dollars to Office Depot for … what? (The ledgers don't tell us.)
All of this brings into question the choices the bond department is making and what
oversight is being provided by the "independent citizens' oversight committee",
the school board, and the district's bond auditor.

How “independent” is this committee and what “oversight” does it provide?
Are citizens truly represented by this committee?

Some oversight committee members actively campaigned for the Measure H bond of 2014
and are involved in the Yes on BB bond campaign efforts. Two oversight committee
members (who are supposed to be representing seniors and a taxpayers
group) are signatories on the Yes on BB ballot argument.   That's not
providing the legally required independent representation for citizens!
The Oversight Committee then kicks its rubberstamp of bond department spending
up to the Board of Trustees, who vote to approve the reckless/wasteful spending
we're seeing in the Measure H bond ledgers.  

Conclusion: “Independent oversight” = meaningless buzzwords used to deceive
citizens into passing more bonds. 
 

Reckless & Wasteful Spending of our 2014 Measure H Bond Funds

A concerned citizen put in a public information request to the district to see how our Measure H bond funds are being spent.  A review of SCUSD spending from the 2014 Measure H bond funds over the past three years shows wasteful spending on items such as:
-almost $2,500 for bottled water (presumably for bond department employees)
-cell phones
-Comcast cable internet
-Travel/lodging/food for conferences
-$380,000 for a stadium sound system
-$75,000 per year for an outside contractor to hand water 20 trees
-Salaries, pensions, and benefits for bond department employees, including administrators paid up to $15,000/month.
-Salary increases which are retroactive. Whatever raise the teachers received, the bond department also gets.
Recall that a bond is a loan, and for every dollar we pay in bond principal we will pay another dollar in interest - all from our property taxes. So an employee costing $15,000 per month in salary really costs taxpayers $30,000 per month by the time the bond debt is paid off.

See for yourself.  Here are the links to the Measure H bond ledgers:

1. SCUSD Measure H Bond Fiscal Year 15-16
2. SCUSD Measure H Bond Fiscal Year 16-17
3. SCUSD Measure H Bond Fiscal Year 17-18

 Here's the link to two information flyers created and donated by concerned citizens:
No on Measure BB Flyer 1
No on Measure BB Flyer 2

Here's the link to the table of how much Measure BB will increase our property taxes, based on assessed value.
Measure BB Tax Increase vs. Assessed Value

Duplicate spending Measure BB and Measure H

14 Duplicate Projects!
Just four years ago the District stated that if Measure H passed we wouldn’t need another school bond for 20-25 years. In 2014, we voted a whopping $419,000,000 to build and repair schools. The list of “needs” included 14 line items found in the current Measure BB. “Leaky roofs” was the tipoff. We laughed in 2014 because with the drought, how would anyone know the roof was leaking? But here we are, four years later, and the District still needs our MONEY for those pernicious leaky roofs. Never mind they’ve blown $380,000 of Measure H bond money on a football stadium sound system for one of the high schools. How does that help our students do better in math & science?

Speaking of student achievement, based on the list of projects on which the District wants to spend our money, the District appears to need a LOT of sports fields to increase student readiness for their 21st century college and career options. Fields last about 10 years; why are we borrowing money for 30 years for fields that will be redone two more times before the debt is retired? We are still paying for the 1997 Measure B bond, which included new fields for both high schools. Field expenses should clearly be in the District’s operating budget, not from bond money.

Vote NO on BB. It’s a Bad Bond.

Our Debt of $1.448 Billion from Measure BB will be their spending!

Measure BB's $720 million in bonds equals $1.448 Billion in debt!   Bonds are debt just like a mortgage.  We will pay back the $720 million  in bond principal + interest/financing costs.  Buried far back in the Measure BB ballot language is the bond's total cost =  $1.448 Billion.

 

All of this money will be paid back by property tax payers, as Measure BB becomes the 5th SCUSD bond on our property taxes and the 18th special assessment added to our property taxes. 

SCUSD violates our trust with its reckless, indulgent spending!  We’re still indebted on the prior four district bonds because we believed it would help our kids’ have brighter outcomes, but those
student outcomes have held steady regardless of how much debt taxpayers incur. We pay generous Prop 13 base property taxes to provide a solid foundation for annual district operations, plus
pay for 4 prior bonds, and here we go again: with Measure BB proposing to heap an additional debt of $1.448 Billion onto district taxpayers.

When we trust the schools with our kids we have a real-time feedback  system in place: our kids! “What happened in school today?” we ask.  And they tell us. But with our money we don’t have any sort of feedback or accountability. With bond measures there’s no corrective interventions  if a year down the line we discover our child’s growth isn’t being nurtured.  We just keep paying. And paying. And paying.

Four times we have accepted that our kids’ futures are more precious  than our money. Truth. But it’s not an either-or situation. Measure BB's  additional debt of almost $1.5 Billion for 32 years doesn't help our kids -  it burdens the next generation as well as current homeowners and renters
with increased housing costs.  There are no exemptions from Measure BB's property tax increase, regardless of ability to pay.

We ask you to vote with us and vote NO on BB.

 

Measure BB is a 5% Property Tax Increase

Don't be fooled! The Measure BB ballot statement is worded to deliberately obfuscate how much this bond will cost taxpayers. The ballot wording of "5 cents per $100 of assessed value" is really $50 per $100,000 of assessed value --> a 5% increase on our base property taxes for 32 years!

 Doing the math:
Our base Prop 13 property taxes are 1% of assessed value, which is $1,000 in property taxes each year per $100,000 of assessed value. 
Measure BB seeks to add $50 per $100,000 of assessed value.  $50 is 5% of $1,000, therefore, our property taxes would increase by 5% per year for 32 years with Measure BB.  

This is on top of the $82.80 per $100,000 that SCUSD already receives for the 4 existing bonds. When homes are values in the hundreds of thousands to millions of dollars, the ballot statement should be a fair representation of what the bond will really cost taxpayers. Reporting the tax rate in cents per $100 to force residents to 'do the math' to figure out what they will pay is unconscionable.

Why 2014 Measure H is a Precedent for District Bond Spending.

District spending of taxpayer money from the 2014 Measure H bond shows why we should vote NO on the 2018 Measure BB bond. 
We made a Public Records Request and received these files from Santa Clara Unified School District:

https://drive.google.com/drive/folders/1lKw1jpUy_6eL9yvjY0392EwRhOTnvD3d?usp=sharing

After a comprehensive analysis, our impressions are as follows: (Numbers are color coded for easy reference in our financial summary below).

1)      All bond spending should be public and available on the SCUSD web site.  It is 2018, way too long for the public to need to use the Public Records Act to get data on a bond measure passed in 2014.  Larry Adams, the Director of School Bond Projects assures us:   “These files are in the process of being posted to our website”.  Two files have been posted.  Where are the rest?

2)      We were SHOCKED to find that the district is spending money, lots of money, on administrators.  Please note the public wase PROMISED on the ballot “no money for administrators”.  Last year alone, $570,788 plus an additional $188,130 in overhead was spent on administrators.  We were lied to.

Ballot language for Measure H of 2014:

To repair or replace deteriorating roofs, plumbing and wiring, remove asbestos, lead and hazardous materials; to upgrade outdated classrooms and career training facilities to support 21st century learning and prepare students for college and careers; to acquire, renovate, construct/equip classrooms and facilities to relieve overcrowding and attract quality teachers, shall the Santa Clara Unified School District issue $419 million in bonds at legal rates, with independent citizen oversight, no money for administrators and all money staying local?

3)      SCUSD is spending incredibly high amounts of money on seemingly small to medium size capital projects.  For example, the sound system for the Wilcox stadium was deemed “critical” and cost $380,377.25.  How is the sound system for a stadium “critical” and why did it cost so much?

4)       IMPORTANT:  SCUSD has spent just $85 million of the 2014 Measure H $419 million bond.  Why are they asking for $720 million more in Measure BB in our upcoming November election?

5)      The pace of spending appears to be slowing down.  Capital Outlay for 2017 was $38 million.  For 2018 it is on track to be just $15 million.  Why does SCUSD want $720 million more when it appears they don’t know how to spend the money they already have?

6)      SCUSD is issuing bonds long before the money is being spent.  This is poor fiscal policy.  For example, $141 million in bonds was issued in 2015.  Now, in late 2018 SCUSD has spent just $85 million of this money.  A private citizen would never borrow money to buy a house 3 or 4 years in the future.  Yet, issuing bonds (and paying interest) way in advance is what SCUSD is doing!  This year, SCUSD is going to issue $232 million more in bonds.  Why?

7)      Contract Services and Operating Expenses have been HUGE.  For example, this cost us $683,186 in 2015.  What could this possibly be for?  Lawyers?  Bond Contractors?  Per the web site “Big Bad Bonds” page “Parasites”:  There is a full-fledged, multi-billion industry that has grown up around school construction bonds, primarily Proposition 39 bonds because of the low rate of voter approval needed. Some of these firms are consultants or advisors whose main purpose is to manipulate voters into passing bonds from which the firms profit immensely.

Are parasites getting our tax dollars? Are the parasites local or from far flung cities like Sacramento or Los Angeles? (The bond language says “all money stays local”)

8)      In our original Public Records Act request, we asked for a detailed breakdown for Classified Salaries, Employee Benefits, Contract Services and Operating Expenses.  This has not yet been provided.   What is SCUSD hiding?

9)      Based on the financials for Measure H of 2014 taxpayers should vote NO on future school bonds, including BB.  SCUSD a) is not transparent, b) lied to us and is spending money on employee salaries and benefits, c) is spending huge amounts on mystery Contract Services & Expenses, d) is issuing bonds long before funds are required, and e) is spending money on questionable Capital Outlays for items we in the public we have no control over due to the vague wording for this bond on the ballot.  These same issues, if not fixed by SCUSD, will repeat themselves over the 30 year life span of BB.

Here is our summary of the financials on the Google drive:

Bond money spent on salaries and benefits

The SCUSD 2014 Measure H bond promised voters that no money would be spent on employee salaries.
In the most recent Measure H audit, we found the District siphoning bond money into staff compensation packages. The “accountable” citizen oversight board accepted the audit’s findings. Let’s break it down: we borrowed and are paying interest to the large financial institution lenders
to shell out staff compensation.

Letter to the Editor. BB is a Bad Bond.

Letter to the Editor in the Silicon Valley Voice:

Santa Clara Unified School District’s Measure BB

Santa Clara Unified School District’s Measure BB is a BAD BOND. This $720 Million Bond will end up costing taxpayers over $1.4 Billion with interest. For what? We don’t really know! The wording is vague and unenforceable, with no list of specific projects. Don’t be fooled by the special interests that will soon be filling your mail box with fancy flyers. Labor Unions, Lawyers, Bond Consultants and District Executives will benefit most from this cash grab, not our children. Measure BB is a 30 year $4 Million / month BLANK CHECK with no ACCOUNTABILITY. Vote NO on BB.

Sally Brett

Promises Broken

The SCUSD 2014 Measure H bond promised voters that another bond wouldn't be needed for 20-25 years. We can’t make this stuff up! Just where did 20 – 25 years’ worth of money go? And why would we reward the District for its lavish spending by giving it another $1,448,643,639 to spend?
Voters will decide.
We ask you to vote with us and
vote NO on BB.





Below is the 2014 Measure H document from the SCUSD website which states that there will not be the need for another bond for the next 20-25 years.  Please see the statement in red near the bottom of the page. 

 

BB = Bad Bond

SCUSD's Measure BB bond is on the Nov. 6, 2018 ballot. Taxpayers will be on the hook for a whopping $1,448,643,639 to creditors if Measure BB passes! Share the facts with your neighbors; we’ll sure be sharing the debt burden if this Bad Bond passes.
Vote No on BB.