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L’Anse Area School District Seeks Sinking Fund Millage

When residents in the L’Anse Area School District head to the polls on Election Day, they will decide whether to approve a 1 mill sinking fund millage.

The district will not be borrowing any money, but instead putting aside the money levied each year to address different projects.

L’Anse Area Schools Superintendent Susan Tollefson said, “It’s really a unique opportunity for us because we were able to refund our bonds from our 2000 construction, and we lowered our interest rate—cut it in about half from four percent to about two percent in February of 2016. So we have a chance to capture some of the savings from that. We can assess a sinking fund and really not raise the debt levy above what it was in 2015.”

If approved, the district will be able to replace the roof on the high school and improve energy efficiency with updates to the boilers and ventilation systems and replacing old windows.

Other infrastructure needs, like flooring and restrooms, would also be addressed.

Tollefson said, “We’re looking at updates to even flooring and tile and carpeting that need to be replaced throughout the building; some needs out on our playground and updates to restrooms within the building.”

The millage is for up to 12 years and a resident with a $100,000 home would be paying about $50 a year, if approved.

For more information, contact Susan Tollefson at stollefson@laschools.us or at 906-524-6000, ext 1.

You can also visit the school website at www.lanseschools.org.

Watch for public meeting dates to be scheduled in the near future.

The election is November 8th.

Here is the press release from the L’Anse Area School District:

L’Anse Area Schools seeks up to 1 mill in November for Building and Site needs

Due to recent Bond Refunding, the overall tax levy will not increase above 2015 amount

The L’Anse Area Schools approved a resolution for up to a 1 mill sinking fund millage to be placed on the November ballot.  A sinking fund millage is a limited property tax to fund major repairs and renovations to school buildings. The tax is levied each year and the revenue generated is used to address the most urgent building improvements identified by a school district. Using a sinking fund, the school district accesses the money on-hand to pay for projects as they are completed. Since the school district has not borrowed money for the projects, no debt is incurred and it does not pay interest on the money used. Hundreds of school districts in Michigan currently have a sinking fund millage.

L’Anse Area Schools is seeking a sinking fund millage of UP TO 1 mill for 12 years. The district was able to refund their bonds from the 2000 school construction and cut the interest rate from 4% to 2% in February of 2016. This savings presents a unique opportunity to add the sinking fund millage and still continue to levy the same amount as was levied prior to the bond refunding. It is similar to refinancing your home at a lower interest rate and putting aside the savings due to your lower monthly payment into a ‘building and site’ account for renovations and repairs. The district was able to refund their bonds at a lower interest rate through the competitive bid process due to a good credit rating. The good credit rating is due to a proven history of fiscal responsibility, stability within the district, sustainability of programs and a board policy of maintaining a fund balance of greater than 10%. Due to the efforts of the district in these areas, the district will have a savings in interest payments that can be now be allocated to building and site needs, if the sinking fund millage is approved by the voters.

Upon voter approval, the sinking fund proposal will address growing needs for facility upgrades. The replacement of the old high school roof, upgrades to the elementary school bathrooms, heating and ventilation system upgrades, energy conservation improvements in all buildings, some window replacements, carpeting and tile replacement, needed safety compliance improvements to the old gym balcony, restrooms at the sports complex and parking lot improvements. The projects would be prioritized and addressed as funds become available over the next 12 years. One mill throughout the school district would generate approximately $144,000 per year, depending on property values. For a home with market value of $100,000, which would typically have a taxable value of $50,000, one mill equates to $50 of their property tax bill.

L’Anse Area Schools is committed to providing the community with detailed information on the sinking fund proposal. Please visit the district’s website at www.lanseschools.org for information on the proposal as well as details about community meetings and presentations. We are striving to continue to be good stewards of taxpayer resources and to be proactive with a detailed long term facility management plan that addresses future building needs.

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