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On Monday, November 10th, the Board of Education of the Essexville-Hampton Public Schools

called for a bond and sinking fund to be voted on by you on February 24, 2015. We wanted

you to be the first to know and hope that this information helps to define our plan of ‘Forging

a New Foundation’ for the Essexville-Hampton Public Schools. Please look through the

information and if you should have any questions, comments, concerns or ideas, we welcome

your input.

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Education & Learning

Forging a New Foundation

November 12, 2014

Dear Essexville-Hampton Public Schools Community,

I am Matthew Cortez, your new Superintendent, and I would like you to read this important information.

Our district sought a bond issue this past August for $41.5 million, which was not successful. I have

learned that one needs to be quick to listen and slow to speak, so I decided to listen.

The proposal that is now in front of you is the first step toward a vision of leadership for our district and

our students into the future. This first stage has been called “Forging a New Foundation,” because that

is precisely what this bond and sinking fund will allow us to accomplish. We need to upgrade and stabilize the foundational structure within our district. We also have to create a sustainable plan for

continued maintenance for our facilities.

The bond allows for our immediate needs to be met, and establishes a strong technological foundation

from which we can develop in the 21st century. However, the bond is substantially smaller and for a

few reasons. Our tax base has decreased with the closing of the Weadock plant and will decrease

further in the next two years with the devaluation of the Karn facilities. This means that our bond will

not produce the same amount of money per mill that it did with our last attempt. So, we had to

downsize the scope and the intensity of the repairs and break them into stages, which gives us the

time to further stabilize our economy.

Due to the smaller bond size we decided that we need to bring forth a sinking fund. This is a measure

to help address the various needs of our facilities over the next five years. The sinking fund has an

advantage of no interest and no cost to set up. Another difference is that the sinking fund is not

obligated to a set scope of projects and can be adjusted as the district’s needs change during the five

year period. All of this allows for the sinking fund to be a better bang for the buck. A sinking fund is

dedicated monies raised to upgrade or replace infrastructural buildings in accordance with the state

law and cannot be spent on certain items, like technology. So, we have to pair the bond and sinking

fund together in "Forging a New Foundation". The sinking fund is a different approach that has not

been used before in our district and we truthfully feel it is the right answer at this time.

Both the sinking fund and bond are regulated by the State of Michigan and cannot be used for salaries,

routine maintenance, or other restricted items. Both funds are audited yearly, and independent of the

general fund audit that is performed annually. The bond monies are for use immediately, and the

sinking fund monies will be distributed over five years. This allows for work to occur in phases, which

will cause less disruption to the school day for students. This first stage of work will allow us to illustrate

the tremendous ideas and vision we have for our district. We have enclosed a great deal of information

within this brochure and ask that you please review it. If you have any questions, please come and

share them with us at our scheduled meetings listed on the back of this flier. We have designated some

district-wide town hall meetings and building level meetings already, but know that my door and ears

are always open for any community member. We hope this information helps to outline our efforts in

“Forging a New Foundation” for our district and our community.

Educationally yours,

Matthew T. Cortez

Superintendent

Bush Elementary School

Bond/Sinking Fund Proposed Projects

State-Approved Bond Projects:

Replace leaking roof

Improve exterior wall

Remove existing masonry chimney

Replace existing lockers

Upgrade main entrance for security

Upgrade mechanical equipment (boilers)

Improve parking lot and site work

Upgrade wireless connectivity

Purchase and install technology units (projectors, computers, carts,

cameras, printers, classroom sound systems, etc.)

Upgrade phones/communication

Purchase and install security cameras

Proposed Uses of Sinking Fund Monies:

Upgrade terrazzo flooring

Provide toilet room exhaust fans

Upgrade toilet room partitions

Upgrade various mechanical units as needed (heaters, chillers, water

heater, etc.)

*A sinking fund is a flexible account used to address the most pressing and emergency needs

of a district for upgrading and replacing infrastructure pieces, not for maintenance items.

Cramer Junior High School







Replace locker room lockers

Add lockers for 5TH grade wing


Replace damaged section of gym floor

Renovate gym wall


Renovate leaking roof


Replace selected interior doors/hardware

Provide cross corridor door assemblies for security

Upgrade various mechanical units as needed (heaters, chillers, water

heater, etc.)



Garber High School



Replace leaking roof

Improve exterior walls

Refurbish exterior doors and sidelights

Replace student lockers

Replace pool roof and roof floor deck

Purchase and install wireless connectivity

Purchase and install technology units (projectors, computers, carts, cameras,

printers, classroom sound systems, etc.)




Upgrade entrances/exits for safety (including band room)

Upgrade lighting, sound, and technology in auditorium

Abate and replace main hallway ceiling

Install safety lights in auditorium

Upgrade heating pipe insulation

Replace selective interior doors/hardware

Install emergency gas shut-offs

Refurbish electrical panel in pool area

Upgrade outside air louvers

Upgrade existing tennis courts

Upgrade existing outdoor bleacher boards

Upgrade various mechanical units as needed (heaters, chillers, water heater,

etc.)



Estimated Taxes Based On SEV Values This is the proposed Bond and Sinking Fund. This chart is the Mill rate through the years.

Home SEV Value $25,000 $35,000 $50,000 $65,000 $80,000 $125,000 $175,000

Home Retail Value $50,000 $70,000 $100,000 $130,000 $160,000 $250,000 $350,000

Year New Mill New Current New Current New Current New Current New Current New Current New Current

2015 6.68 $167 $79 $234 $110 $334 $158 $434 $205 $534 $252 $835 $394 $1,169 $551

2016 6.68 $167 $79 $234 $110 $334 $158 $434 $205 $534 $252 $835 $394 $1,169 $551

2017 4.37 $109 $79 $153 $110 $219 $158 $284 $205 $350 $252 $546 $394 $765 $551

2018 4.37 $109 $79 $153 $110 $219 $158 $284 $205 $350 $252 $546 $394 $765 $551

2019 4.37 $109 $79 $153 $110 $219 $158 $284 $205 $350 $252 $546 $394 $765 $551

5yr Comparison $662 $394 $926 $551 $1,324 $788 $1,721 $1,024 $2,118 $1,260 $3,309 $1,969 $4,632 $2,756

2020 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2021 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2022 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2023 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2024 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2025 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2026 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2027 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2028 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

2029 1.37 $34 $79 $48 $110 $69 $158 $89 $205 $110 $252 $171 $394 $240 $551

10yr Comparison $343 $788 $480 $1,103 $685 $1,575 $891 $2,048 $1,096 $2,520 $1,713 $3,938 $2,398 $5,513

15yr Comparison $1,004 $1,181 $1,406 $1,654 $2,009 $2,363 $2,611 $3,071 $3,214 $3,780 $5,021 $5,906 $7,030 $8,269

Difference $177 $248 $354 $460 $566 $885 $1,239 * Savings is based on the current tax rate of 3.15 mills for the next 15 years versus the proposed new Bond and Sinking Fund Plan for the next 15 years.

Bond

Proposed Millage Amount $ Years Est. Mill Rate Tax Year

1.37 $ 4,970,000.00 2 0.53 2015-2016

13 1.37 2017-2030

Sinking Fund

Proposed Millage Amount $ Years Est. Mill rate Tax Year

3 $ 5,575,964.00 5 3 2015-2019

Year Current Mill New Mill Total Mill Funding

2015 3.15 3.53 6.68 $ 6,083,170

2016 3.15 3.53 6.68 $ 1,090,907

2017 0 4.37 4.37 $ 1,107,270

2018 0 4.37 4.37 $ 1,123,879

2019 0 4.37 4.37 $ 1,140,738

2020-30 0 1.37 1.37 N/A

The chart below estimates taxes compared to the current rate:

1. Find your home’s SEV Value or Taxable Value.

(Please visit https://www.bit.ly/BayCountySEV for your SEV Value)

2. Notice that the first five years the taxes will fluctuate.

3. In the last ten years the taxes are stable at 1.37 mills.

4. Results are a tax savings* over the 15 year period.

https://www.bit.ly/BayCountySEV

Mark Jaffe Building/District



Purchase buses



Purchase and install sound presentation system for

conference room


Upgrade exterior lighting

Upgrade various mechanical units as needed (heaters,

chillers, water heater, etc.)

*A sinking fund is a flexible account used to address the most pressing and

emergency needs of a district for upgrading and replacing infrastructure pieces,

not for maintenance items.

Verellen Elementary School



Construct new cafeteria/multi-purpose room

Improve exterior walls

Replace existing lockers

Add additional lockers

Renovate main lobby and corridors

Improve parking lot and site work







Upgrade exterior doors and sidelights


Upgrade air supply to ventilators

Upgrade mechanical units as needed (heaters, chillers, water heater, etc.)



Language for Ballot ProposalsBonding Proposal

I. Shall Essexville-Hampton Public Schools, Bay County, Michigan, borrow the sum of not to exceed Four Million Nine Hundred Seventy Thousand Dollars ($4,970,000) and issue its general obligation unlimited tax bonds therefor, for the purpose of:

The following is for informational purposes only:The estimated millage that will be levied for the proposed bonds in 2015 is .53 mill ($.53 on each $1,000 of taxable valuation). The maximum number of years the bonds may be outstanding, exclusive of any refunding, is fifteen (15) years. The estimated simple average annual millage anticipated to be required to retire this bond debt is 1.37 mills ($1.37 on each $1,000 of taxable valuation). The school district does not expect to borrow from the State to pay debt service on the bonds. The total amount of qualified bonds currently outstanding is $3,420,000. The total amount of qualified loans currently outstanding is $-0-. The estimated computed millage rate may change based on changes in certain circumstances. (Pursuant to State law, 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.)

Millage Proposal, Building and Site Sinking Fund Tax LevyII. Shall the limitation on the amount of taxes which may be assessed against all property in Essexville-Hampton Public Schools, Bay County, Michigan, be increased by and the board of education be authorized to levy not to exceed 3 mills ($3.00 on each $1,000 of taxable valuation) for a period of 5 years, 2015 to 2019, inclusive, to create a sinking fund for the construction or repair of school buildings and all other purposes authorized by law; the estimate of the revenue the school district will collect if the millage is approved and levied in 2015 is approximately $1,113,170?

FREQUENTLY ASKED QUESTIONSQ- What is the difference between a bond and a sinking fund?

A-The bond is a State-approved funding process that has a set scope of projects and cannot be expanded without communicating to the State – it is set in stone. A sinking fund is a funding initiative to give a district flexibility in meeting its individual needs. The project list is not set in stone and the district can add and subtract projects as needs arise or go

away. Both of these initiatives are heavily watched and audited separately from the general budget to account for every

dollar spent.

Q- Why are we seeking both a bond and sinking fund?

A-The economy and taxes recently took a downward turn in our district, due to the closing of power plants and

scheduled de-taxation of other plants. This means that the bond (being a long-term investment) is negatively impacted, whereas a sinking fund is a short-term investment that is not as affected. By combining both we are overcoming the limitations of both while listening to our community. The community wanted to see us work in stages and “Forging a

New Foundation” is the first stage of improvement for EHPS.

Q- Why do we need a bond issue?

A-Time has caught up with our four buildings and they need significant updating. Our kids deserve to have places to learn that are safe, secure and up-to-date. For instance, Verellen Elementary needs a cafeteria/multi-purpose room

because gym use is affecting core instructional time, so lunches must be shoe-horned in the schedule. We need to

eliminate gym time conflicts with core instructional time. Every school building has drawbacks that needs addressing as soon as possible. (Please see the listing of proposed improvements.) Q-Why another bond election now?

A-We were able to get a proposal on the Michigan Loan Bond Fund (MLBF) just in time. Otherwise we would not be able

to address infrastructure and technology problems until the MLBF opens again in 2016. Costs would be much higher if

we had to use private bond markets. Passage of a bond and sinking fund now will save money.

erecting, furnishing and equipping a cafeteria/multi-purpose room addition to Verellen Elementary School; remodeling, furnishing and refurnishing, and equipping and re-equipping, other school buildings and facilities; acquiring and installing instructional technology in school buildings; purchasing school buses; and preparing, developing, and improving sites?

Q-What do better school buildings mean to a community?

A-Essexville-Hampton always has been considered the best place to live in Bay County because of its outstanding school system. Many people have moved to this community mainly because of the good schools. Without modern infrastructure and technology in our schools, property values would not be as solid as they have been for years. Homes would be worth less. We need to continue to attract new families and keep a solid tax base for the schools. Our Essexville and Hampton Township communities need the stronger tax base as well.

Q-Why weren’t the buildings maintained as the years passed?

A-We have made continual repairs and patchwork upgrades wherever possible with our custodial/maintenance staff.For instance, the boilers at Bush Elementary are old and could go any day. The cost of replacement is about $150,000. Every homeowner knows roofs need replacement after 20 years or so and all our school roofs need to be repaired or replaced.

Q-Why are two questions going to be on the ballot February 24?

A-We determined that a sinking fund would give more flexibility in dealing with infrastructure problems; the bond issue can only be spent on specific improvements, nothing else. All the improvements will be listed on signs at each school for you to review, which are also in this brochure. Passage of both issues is vital to catch up on needs of all schools that were built in the 1960s.

Q-How much will the sinking fund and bond cost?

A-In 2015 and 2016, the old bond of 3.15 mills and an increase of 3.53 mills (for bond and sinking fund) willcombine for 6.68 mills total. The debt will then reduce to 4.37 mills until 2019. From 2020-2030 the debt millagewill be 1.37 mills. See center chart for details.

Q-Will any of the bond money go to pay teachers and staff?

A-No, there are strict restrictions that all the funds raised under these issues must be used ONLY for buildings and equipment necessary to support the outstanding student achievement in which this community is known. Bond fundscannot be used for administrative salaries or general operating expenses either.

Q-Are we paying for kids from other districts under Schools of Choice?

A-No, students from outside the E-H district bring with them the state aid of $7,000+ per student per year (depending on the state formula), and they are accommodated for learning in the classrooms and with the equipment we have forin-district students. There is no need for any extra spending for SOC students. Actually, the additional revenue they bring in helps us maintain programs for our kids.

Q-What about achievement? Are EHPS kids keeping up in academics as has always been the case?

A-The graduates of Garber are among the highest achieving students in Bay County. Our graduation rate is the highest in the area. Many students receive college scholarships that help parents offset today’s high cost of college. We need toshore up the environment with buildings and technology to meet the needs of today and tomorrow so high student achievement can continue to be an E-H hallmark.

Q-This election is in February and many people will be out of town; how can they support the schools?

A-The parents and community supporters on the committee are making an effort to get the information on the questions and make absentee ballots available to all who wish to vote. If you know a neighbor who needs information and/or an absentee ballot, please let us know by calling 894-9700.

IN SUMMARY, this revised program of improvement of the Essexville-Hampton Schools on the ballot February 24 will

make us stronger and more closely tied to the community. We urge all voters to consider it carefully as our future,

and that of the kids and the community, depends on its success.

Please join us for any of these informational meetings:

District Level Q & A

Wednesday 11/19/2014

6pm at Garber High

School

Wednesday 12/10/2014

6pm at Cramer Junior High School

Wednesday 2/11/2015

6pm at Bush

Elementary

Wednesday 1/21/2015

6pm at Verellen

Elementary

PRSRT STD

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EDDM RETAIL

Local

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Verellen Elementary School

January 19, 2015 at

5 p.m.

Bush

Elementary School

January 19, 2015 at 6 p.m.

Garber

High School

Parent-Teacher Conferences

December 3, 2014 at 4 - 6:30 p.m.

Cramer Junior High School

Parent-Teacher Conferences

Nov. 11, 12, 24, 25 Building

Specific Q & A

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