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School bond vote and other action at LP-A meeting: petition response, audit report, 2008 levy

Supporters of a new school in Lake Park-Audubon are hoping voters will be in the Yuletide spirit this year: residents will vote on whether to bond for school improvements just a week before Christmas

The LP-A Board on Monday voted to set a special election for Dec. 18, and to let voters choose from two options on the ballot.

Question 1 on the ballot will be a bare-bones version of the project rejected by a slim margin on May 8 -- stripped of its ball fields, landscaping, full generator capacity, paved parking lots, renovated gym and locker rooms in Audubon, and other "non-educational" amenities. The bond for this option will be $23 million.

Question 2 will be for the full-service project -- a new 7-12 high school in Lake Park and new/renovated pre-K-6 elementary school in Audubon.

The bond for this option will be $25.8 million, but the measure simply asks whether the voter wants to approve an additional $2.8 million for the more comprehensive project. Both are 25-year bonds.

Both questions will have a "yes" and a "no" box next to them, and those who want the full-service school will have to vote "yes" to both questions, since the full-service measure will only pass if the bare-bones measure also passes.

If only Question 2 is marked, the ballot won't be counted.

"No" voters only need to vote no on Question 1, because if that option fails, they both fail.

The motion to put the two-question ballot before voters was made by Rick Ellsworth, seconded by Mike McIntire. The board approved it unanimously.

If approved, the bare-bones measure will cost the owner of a $100,000 residential homestead $193 more in property taxes per year.

Approval of the full-service school would cost that homeowner another $24 a year, for a total of $217 a year.

The owner of a $400,000 residential homestead would pay an additional $773 per year for the cheaper option, and $95 more, or $868 a year, for the full school package.

Commercial/industrial property valued at $100,000 would see a property tax hike of $290 a year with Question 1. It would be another $36, or $326 a year, for Question 2.

An agricultural homestead valued at $300,000 would pay $406 more a year for the less expensive option. It would cost another $50, or $456, for the full-service school.

The non-homestead portion of that agricultural land would increase by $1.93 per $1,000 per acre, according to an analysis prepared by Ehlers and Associates.

Petition response

The LP-A board will take no action on a petition presented in August by Audubon resident George Kohn, which asked that the board rescind its November 2006 decision to extend the terms of office of school board members by one year.

The board extended the terms as a money-saving plan endorsed by the Minnesota School Boards Association to switch to even-year school board elections. It's less expensive to hold the school board election the same time as the general election, held during even years.

The board presented Kohn with a letter explaining its response. It includes this response from the Minnesota School Boards Association:

"The petition that the citizens brought to your board is not valid and is an incorrect interpretation of Chapter 646, Section 26, Subd. 3 (which) pertains solely to when elections should be held in 2001 and 2003. It does not apply to election thereafter.

"In that same section, Subd. 1 gives the legal right for a district to alter its election cycle with an orderly transition plan.

"The petition is wrong to say that Subd. 3 applies to 2007 elections. It does not. The district is following the law by passing a resolution in 2006 that moved the district to even-year cycles. The district is in accords with 1994 laws. It is the petition that is not valid."

At this point, several state laws would make it illegal for the district to follow the petition: The state filing date for candidates was July 3-14.

"This filing date has passed," the MSBA states in the letter. "It would be illegal for any school district to have an election by violating this statute." Deadlines for a primary election were also missed.

"Citizens cannot petition to force an election. Only the state can set election dates. That date is Nov. 6, with all requirements for notices, absentee ballots, etc.."

Kohn, who attended the meeting, told the board that its response was a disservice to the registered voters who signed the petition.

"So the 200 people who signed this petition, they mean nothing?" he asked. "You ruin our democracy, you and the state, when you do these things."

Annual audit

The board received the district's annual audit report from the private accounting firm Eide Bailly of Fargo.

There was good and bad news about the district's financial situation.

On the plus side, total revenue was up 7 percent over last year, while the board has held the line on spending, bringing total expenditures up just 1 percent.

"Your expenditures are almost exactly the same as last year," said Jackie Erovick of Eide Bailly.

The district was able to keep its budget on track, with a variance of just 2.3 percent, "which is excellent," she said. "Good job for you guys for budgeting so well."

Unreserved funds are up to $477,000 this year, from just $167,000 last year.

That's a great improvement, but it still represents just under 9 percent of general fund expenditures, and undesignated reserves should ideally be at 25-30 percent of general fund expenditures, she said.

In a bid to draw in kids at an early age and keep them at LP-A, the board has increased funding for early childhood education. It has been spending more than the state provides for preschool children, which has left the community service fund about $167,000 in the red.

It's basically an accounting measure, but at some point the board will have to pay off the deficit in that fund, and a smaller one in another fund, by transferring money from the general fund.

"There has not been a comfortable margin in the general fund (to do that) until now," Hogie said, adding that the board is considering making a $50,000 transfer this year.

The deficit fund balances were subject of an auditor's "finding" (a problem that should at some point be fixed).

Another finding involves the superintendent's expense account. Auditors found no discrepancies in it, but said the procedure should be improved so that expenses are reviewed by a board member, as a matter of policy. "To get another set of eyes on it," Erovick said.

The board also agreed to levy the maximum amount allowed by law, which will bring in about $65,000 more next year than this year, for a total levy of about $810,000. That's an 8.7 percent increase over this year's levy, Hogie said.