To have a referendum or not to have a referendum. That is the question that the Oak Park and River Forest High School District 200 school board will consider over the next five weeks as it moves toward deciding how to pay for an estimated $102 million project, known as Project 2, to tear down and rebuild the southeast section of the high school which mostly contains physical education facilities.
At the board’s March 23 meeting the school’s Community Finance Committee (CFC) presented the school board three ways to pay for Project 2 although the board is not limited to only those three options. The CFC did not recommend any option. Two of the three options would include a referendum asking voters whether they want to issue bonds to pay for a portion of Project 2.
As has been the case for months the public comment portion of the school board meeting featured comments from those strongly in favor of a referendum for Project 2 funding and those strongly opposed to a referendum. Four speakers favored a referendum and four opposed a referendum.
Those opposed to a referendum stressed that a referendum, which couldn’t be held until next year because that is when the next election is scheduled, would likely delay the start of Project 2 by a year. A one year delay is estimated to raise the cost of Project 2 by $6 million although that estimate does not include the increase in the reserve funds held by the district resulting from an additional year of interest earnings on the portion of reserve funds that are projected to cover nearly half the cost of Project 2. The additional $6 million cost has been included in the projected costs of the two options that would include a referendum.
“This school needs this work done now and this community wants this work done now,” said River Forest resident Jordan Chalmers as about 15 people stood behind him supporting him during his public comment. “Let us not debate over what amounts to $5 a week on our taxes. Let us instead discuss how soon we can get this project started and completed so students can benefit from a 21st Century learning environment that they deserve.”
Ann Krieter of Oak Park agreed. Krieter said the physical education facilities at OPRF badly need to be replaced.
“Generations of Oak Park and River Forest children have not had adequate physical education facilities at this high school due to the inability of our community to get the critical work accomplished,” Krieter said. “Generations. It is not a badge of honor when a current student says, ‘Oh my grandparents, or my great grandparent played in this gym, they swam in this pool, they changed clothes in this locker room.’ That is not a badge of honor. It’s sad, it’s embarrassing; we can do better.”
Krieter said there are non-financial costs to holding a referendum. She worried about the divisiveness a referendum would cause.
“There are things that you cannot put a dollar amount on and that would be student morale and community morale,” Krieter told the school board.” I believe pushing Project 2 to a referendum might appease a minority of community members in the short term but I believe divisive rhetoric that would surround a referendum vote would create long lasting divides in our community and, quite frankly, I don’t think we could handle that right now. We are a community that is still recovering from a pandemic and all the divisiveness that came with it.”
Those supporting a referendum said it is the democratic and usual way to fund and decide upon large long term capital projects. They also pointed to a 2020 non-binding advisory referendum in Oak Park in which 76.6 percent of voters approved of the notion that all local public capital expenditures of $5 million or more be sent to voters for approval in a referendum.
Pete Prokopowicz, who finished fifth in a race for the Oak Park Library Board in 2021, also noted that Project 2 would be the largest capital expense in OPRF history.
“If this doesn’t call for a referendum what does,” Prokopowicz said.
Referendum advocate Monica Sheehan of Oak Park noted that four current members of the school board, Fred Arkin, Tom Cofsky, Mary Ann Mohanraj, and Sara Spivy, have said at candidate forums in either 2019 or 2021 that they would support sending any proposed Project 2 funding to a referendum. But now those board members and the entire school board are keeping their options open.
All of the options presented to the school board include the expectation of receiving at least $12.5 million in charitable donations from the Imagine Foundation which was created to raise private money for the project. The first option would ask voters to approve issuing $44.5 million in bonds and use $51 million from the school’s cash reserves to pay for Project 2, which includes a new swimming pool. This option, if approved, is projected to cost the owner of a home worth $500,000 an additional $199 in taxes annually for the next 20 years. This option has a projected overall cost, including interest, of $133.9 million.
The other option that would necessitate a referendum is now being called option 3. It is a bit of a smorgasbord consisting of $44 million in reserve funds, $15.6 in five year debt certificates, a kind of debt that is paid for out of the district’s operating levy rather than from a specific bond levy, $22.2 million in debt service extension bonds, a kind of bond that only is subject to a referendum if at least 7.5 percent of registered voters in the school district sign a petition asking for a referendum, and $13.7 million in referendum bonds along with the $12.5 million Imagine Foundation donation. This option has the lowest overall cost at $122.9 million even after adding on the estimated $6 million cost of a one year delay. It is projected to cost the owner of a home worth $500,000 an additional $188 a year in taxes over 20 years but that cost would vary over time ranging from $414 a year in the first five years to just $61 a year in years 11 through 20.
The option that doesn’t require a referendum would be to borrow $45.3 million in 20 year debt certificates and to use $44.2 million in cash reserves and the $12.5 Imagine contribution. Since debt certificates are paid out of the operating levy this option would result in no separate levy but the CFC estimates that the financial impact on an owner of a home worth $500,000 would be $199 a year, identical to the first referendum option. The overall cost, including interest, of this option is estimated to be $127.9 million.
CFC members, who did not recommend any particular option, were concerned about the long term impact of using $3.5 million in operating funds to pay off debt every year for the next 20 years in this option.
But Alison Welch, an Oak Park resident, argued in her public comment that financing the debt from the operating levy would force financial discipline on future school boards and administrations.
“Approving to fund the project without referendum bonds can offer a check and balance to the board and administration encouraging fiscal responsibility so that the budget is managed within the standard operating tax levy versus adding a second taxpayer levy just for the referendum funding,” Welch said.
At last week’s meeting school board members asked the CFC chairman Steve Miller and vice chairman Greg Kolar basic clarifying questions. School board members are expected to discuss the funding options in more detail at their April 13 Committee of the Whole Meeting and hope to vote on a funding option at their April 27 meeting, which will probably be the last full meeting that departing board members Spivy, Gina Harris, and Ralph Martire participate in before three new board members are seated in May.