This fence at the football field is all that stops the floodwaters from flooding the football field during last week's 4+ inch rainfall. The arrow points to the single drain on the other side of the fence that is barely able to keep up with the rainfall. The fence was built after the Texas School Safety Center ding'ed the District for not having a security fence around the field. See more about this fence here.
Below is the agenda for this Sept 9 2024 meeting, with my agenda analysis and meeting analysis underneath. You can also find my commentary about the sale of the bonds here.
A. Agenda Analysis 1. Open forum, item 4: If you are thinking you will speak here to protest the tax increase, well, good luck with that. The time to influence the Board on the tax rate was at the Public Hearing at the last meeting.
2. Bond issuance, item 5: And so it begins - this is the first step in leveraging our county’s unique ad valorem wealth: minerals from Irion County oil and gas that can’t be recaptured by the State’s dysfunctional education finance system. It’s a bit like buying a shiny new car with a loan that can never be repaid…the buildings purchased with the bonds never appreciate and the cost to maintain them continues to increase, causing ongoing tax increases.
As I did with the 2019 bonds, I hope to be putting some sunlight on who is getting these funds. (Architect Jeff Potter, for example, took a cool $900,000+ of the $18 million 2019 funds.) Live Oak Public Finance took home a portion of the 2019 bond funds, and, yes, they are returning again in 2024 for more funds...and they get theirs at the barrel head.
Here is the fee structure for Live Oak for the sale of both the 2019 and upcoming 2024 bonds:
Not including the expenses, this means Live Oak was paid $85,000+ for the sale of the ($18 million) 2019 bonds, and potentially $210,000+ for the sale of the ($53 million) 2024 bonds. That's a lot of dough for a jug keeper (what my father called money changers), and there's no wonder Live Oak had a representative, John Blackburn, at the community meetings when IC ISD was pitching the bond election in 2019 and earlier this year in 2024. Financing public school bonds is quite profitable, and there is little or no risk because the bonds are backed by the full faith and credit of the State of Texas. (IC ISD can bust its bond budget like it did in 2019, but even that won't impact its Moody's rating because of the State's backing.)
Finally, here is the entire contract between Live Oak Public Finance and IC ISD that I received pursuant to my recent PIA request. Note that the contract hasn't changed since 2018.
3. Adoption of 2024 tax rate, item 6: This vote is a mere formality for the Board at this point. No one protested at public hearing, and, regretfully, the parents are oddly apathetic about how taxes impact public education. In theory, this is a "neutral" tax increase, as the District is clawing back some of tax savings given to homeowners by the Texas legislature last session. In reality, however, I think we will see increased maintenance and operations expenses as a byproduct of the 2024 bonds, just as we are seeing with the 2019 bonds. (More on increased M&O expenses in the future, but to perhaps pique your interest consider this: the District in 2024 is spending more on electricity in one month for the new gym, City Gym, than it did for its entire campus for the entire year in 2008.) 4. Closed session and actions on closed session, items 11 and 13: I am not aware of any open meetings exception that will allow a closed session on the school calendar or on portables. Enough said.
It's not as if Supt. Ray DeSpain cornered the market in bad hydrologic designs with the 2019 bond funds. An earlier superintendent (Billy Barnett?) approved the plans for this single drain to be the sole remedy for the floodwaters pictured in the photo above. This happened back when the field was converted from grass to artificial. Some of the 2019 bond funds were used to clean it out, and I'm betting it needs more attention by now. It is always going to need cleaning, another example of ongoing M&O expense from a bond project.
B. Meeting Analysis 1. Open forum, item 4. No one was present, thus allowing for a friction-free meeting for the Board to borrow, tax and spend.
2. Bond issuance, item 5. Mr. Blackburn presented a PowerPoint on the District’s first bond issuance, $30.37 million, of the 2024 bond authorization. The Board approved the sale, which was a foregone conclusion as the sale happened this morning - that is, the sale had already taken place.
Read my commentary about this bond sale below.
3. Discuss/approve adoption of tax rate, item 6: As predicted, the Board approved the tax rates mentioned in the agenda item without discussion. Tax Assessor Collector Joyce Gray was present and diplomatically guided the Board on the proper motion. The bond sale was a foregone conclusion, and so was this. To wrap this part up, no community member objected to the tax rate. 4. Administrative Reports, item 7: Principal Parker gave a report on both schools. During her presentation the question of "What is FAFSA?" came up. One thing to consider in this fall's presidential election - if the Department of Education is abolished, so potentially will all the aid that goes with the FAFSA. Superintendent Moore's report covered a number of things, but, to the point, she gave an update on bond matters. The renderings on the proposed maintenance barn are complete. More on all that later after my next PIA request.
5. Discuss/approve bus, item 8: Ryan Kramer, the District's new transportation consultant, was present and gave what I considered to be a fascinating review of federal and state bus/transportation laws. He was so careful to say, in effect, I am aware of some districts who are fudging on these laws, but I don't recommend that! (A van that transports students still has to comply with all federal safety regulations.)
After discussion, the Board took his advice and approved the purchase of a 14 seat bus for $98,300.00. To put this in perspective, about 100 years ago when my grandmother, Nan Lackey, attended school in Irion County as a student, she rode her horse from the family ranch about 8 miles out and kept it in a stable a few blocks from Sherwood Courthouse. 6. Consent agenda, item 9: Less than was spent on the consent agenda. That's how fast consent agendas are meant to go, but too fast to be certain the District is properly spending our tax funds. 7. Closed session and items from closed session, items 11 and 13: Nothing was voted on at item 13, so I'm sticking with my analysis above. I'm not aware of any exception for portables or the calendar that would allow this closed session. 8. Who wasn't at this meeting and more: Board member Taylor Douglas and Principal John Morrow were not present. More: watch for news on the closure of 3rd Street near the school for the placement of portables in preparation of raising the old part of the elementary school.
C. Commentary on the IC ISD bond sale
Of that $30.37 million bond sale, Mr. Blackburn and a host of other Jug Keepers, including JP Morgan Chase, will be collecting about $370,000 in fees. Mr. Blackburn, coincidentally, mentioned that there were literally “billions” of Texas school bonds sold last month. A lot of public wealth just got transferred, folks. A lot.
So, consider this for this school district with only 339 students comprising a county wide boundary with less than 2,000 population AND that is not growing: the Jug Keepers set their sights set on the public wealth of this community, and in 30 days when the financing is funded they will handsomely profit off our our community's educational system yet never have lived here, worked here or even physically participated in our local economy. Moreover, they have no vested interested in improving the educational outcome of the local students. They have had one interest: profit. And government is helping them make that profit with in fact as few regulations as possible.
I'm going to coin a phrase here and ask that you re-align your thinking to macro economic levels: the sale of these bonds makes IC ISD an integral part of the school bond industrial complex. Think beyond the Jug Keepers here and ask this simple question: what companies and individuals are going to profit from these $30.37 million in bond funds? And, which investors? And, what will their profit be based upon? The future market value, a mere bet really, on the price of oil and gas. This is hands down neoliberalism - that is, a neo laissez faire economic model that supports global capitalism and that favors the deregulation of free markets and the privatization of wealth.
So, who gets all that wealth? Well, to start with, it is simpler to state who doesn't get all that wealth: the children attending IC ISD, and, to throw salt on this wound, neither do the children of those ambitious IC ISD school board members who voted for the bonds in the first place. Absolutely none of this massive investment in education has anything to do with improving education. (As I've said before, none of the 2019 bond funds were spent on the construction of a single classroom.) Indeed, if Mr. Blackburn's analysis happens to be wrong (as it was in 2019 with the school bond industrial complex betting on wind energy) it will be the children who will pay the most for the lack of wealth. And, next, the teachers will pay. They will pay in the form of low wages and lay offs.
At this point my daughter, a Gen Z'er, might point out, disapprovingly, "This is late stage capitalism, Dad!" Think on it. What happens when, not if, this economy moves to an energy source more efficient than oil and gas? To be clear, Mr. Blackburn is not the personification of evil...he is the personification of a mere...bet.
I'm not spouting economic theory here. This is economic reality. And, this reality is the same in school districts all over Texas, whether it be from over dependence on oil and gas wealth or property wealth, and it has the blessing of the Texas Legislature, Texas Governor Greg Abbott and, most importantly, the Texas Education Agency.
School bond industrial complex.
More reading: TEA's Bond Guarantee Program; also, consider this section of the law, Texas Education Code 45.0533, that in effect keeps all communications TEA might have with "nationally ranked investment firms" concerning the health of the Bond Guarantee Program and the fund that supports it, Permanent School Fund, protected from disclosure under the Public Information Act.
Copyright 2024 G Noelke