More than 100 residents of Community Consolidated School District 15 gathered at the Palatine library March 30 to mobilize resistance to bonds the district is looking to issue.

At its March 10 board meeting, the district voted 4-3 to issue $27 million in bonds—about $17 million of which would go to capital improvement projects and $10 million would go toward creating a working cash fund, District Supt. Daniel W. Lukich said. The final vote is scheduled to take place at the board's April 14 meeting.

Lukich said the list of capital improvement projects, which could include repairs like new roofing on elementary schools, has not yet been made public, but would be soon.

He said the capital improvement project list is "not just a wish list."

The list of repairs and improvements is based on the Health/Life Safety report filed with the state, he said. The bonds would provide the district with a means to make those repairs without withdrawing money from the general operations or education funds.

But board member Sue Quinn, who spoke at the March 30 meeting, said the district really only has between $6 million and $7 million in capital projects that need to be completed in the next two to three years—a stipulation of the Build America Bonds the district would issue for those projects.

Quinn, along with board members Mark Bloom and Timothy Millar, voted against issuing the bonds.

She said the bonds would max out the district's credit and extend the amount of time it is in debt.

"They want to bring that [bond] money forward for working cash and operations," she said. "It just doesn't make good financial sense."

At the March 10 meeting, she proposed that the board restrict the bonds to only capital improvement projects.

Quinn also took issue with the fact the board took a bond offer aftear hearing from only William Blair & Company.

"We didn't bid it out," she said. "I don't know if we're getting good rates."

The district would pay more than 5 percent in interest over the 20-year life of the bond, which Quinn said means the district ultimately loses millions when the bond money is used on short-term funds like working cash.

The working cash fund would be used for operating expenses and act as a reserve in the likely case that Cook County is late paying the district's property taxes, upon which it is largely dependent, Lukich said.

However, he pointed out that the late payments are not the only reason the district wants the bonds for working cash.

"It's not one aspect, it's the entire economy shrinking," he said.

Lukich added that many school districts have working cash funds.

Eric Anderson, a District 15 parent and municipal bond expert working with Harris Bank, said at the March 30 meeting that he believes that tax anticipation notes would be a better solution to address the district's needs for working cash. Tax anticipation notes would cover the district's expenses while it waits for tax funding to come in from the county.

Lukich said those notes are not sure-fire answer.

"They would rather see us use tax anticipation notes," he said. "It's simply a difference of perspective. One side is not entirely wrong and the other is not entirely right. There's a slight difference."

District 15 did not make any major cuts this year and is considered in good financial health by the state. But the district is looking at slicing $2.5 million out of the budget for the 2011-12 school year.

"We're reducing staff every year because we're down 100 to 200 students every year," Lukich said. "We're reducing staff as we go, but we know we have to cut to continue to maintain fiscal stability. What the bond does is allows us to not cut as much and to improve our facilities out of a separate fund."

Upon learning of the district's plans, Palatine council members asked Village Manager Reid Ottesen to investigate. Ottesen will meet with Lukich and report to the council.

Several council members attended the March 30 meeting, where Ottesen spoke to how the bonds will effect the village's overall bond rating, something of concern to council members as the village prepares to to finance the new police headquarters.

He said the village is currently refinancing some of its bonds to take advantage of lower rates, something the district is also looking to do, but that the village's refinancing does not tack on any more years.

The district's bonds would push debt further into the future, he said.

The final vote on the bonds will take place at the April 14 board meeting, unless residents get 10 percent of the district's registered voting population—about 6,300 people—to sign petitions by April 10, which would force a referendum.

For more information or petitions, go to www.district15schoolboard.wordpress.com.

—by Michelle Stoffel, triblocal.com reporter