In 1997, a $165 million school bond was passed by the voters. Because a two-thirds voter approval was required, the bond amount was set for less than the district required. The proceeds from that bond will be fully spent by 2004.
Now a new school facility bond for $429 million is before the voters in 2002. The required voter approval rate is now fifty-five percent and interest rates are low, so the rest of the required amount is being asked for.
AVCA was asked to take a position on the subject bond.
To evaluate the new school bond, AVCA largely focused on how well the 1997 Bond was spent and conducted multiple interviews with Gary Rummelhoff, President of the SJUSD Board; Steven Wincor, Chairman of the 1997 Bond Oversight Committee, (BOC), a volunteer position; and Gerald Norve, active citizen, CPA, and former auditor for a large accounting corporation. As an outsider, Mr. Norve, closely follows school bond activity and supplied AVCA with much information.
Due to the mishandling of a school bond in San Francisco, outside annual auditing of school bonds is now a requirement. This will apply to the new bond, but was not required for 1997 Bond. The 1997 Bond relies on an internal audit by the school district's financial services group and the BOC to keep track and reconcile income and expenses. There is also an annual outside audit of the entire SJUSD financial flow.
The BOC is made up of volunteers from the community. They meet on a quarterly basis for the purpose of assuring that proceeds of the bond are expended in a proper manner for their intended purpose at District schools. Reconciliation for the BOC consists of reviewing bids, quarterly activity, and financial reports.
The BOC works from the details of reports rather from summaries such as the internal audit. The BOC has not delved into the infinite details of every bid, element of construction, change order, etc. It has monitored bond sales, construction costs, administration costs, decisions, bidding, overages on sites and materials/labor/etc. The BOC has also toured sites and answered questions from parents, the community (such as AVCA), schools, etc. The BOC Chairman stated to AVCA that when questions came up, the school district was quick to cooperate and make the suggested changes.
The Chairman of the BOC, Steven Wincor, has stated to AVCA the following: "All in all, I would say that this Bond has been managed well, that the BOC has done its job to ensure that the funds were expended correctly, and that there has been no use of the funds for Non-Bond activities (to the best of my knowledge)".
AVCA found the SJUSD and the BOC representatives to be quite cooperative as AVCA sought information.
Because of the experience of the 1997 Bond, requirements for the new bond are better focused, and AVCA is satisfied that they are well thought out.
AVCA supports the new $429 Million School Bond.