Mo. lawmakers review school district debt limit

JEFFERSON CITY, Mo. -- Some growing Missouri schools and small districts lacking high-dollar property are facing challenges to fund needed construction projects because of a state cap on their debt.

Districts approaching the limit have turned to alternatives such as tackling major projects in phases, but those approaches can drive up the ultimate cost. Now, Missouri lawmakers are considering a measure that would allow school districts to ask voters for permission to exceed the cap.

Two areas that could benefit are Liberty, Mo., in suburban Kansas City and Nixa, Mo., which is between Springfield and Branson. Hundreds of students in Liberty are using modular classrooms, while Nixa has added 2,600 students since 2000 and again is starting to use mobile units.

"It is said: 'Build it, and they will come.' But in Nixa, we find ourselves saying, 'They're here, what are we going to do with it? Can we convert a custodian's room or a closet into a small classroom?"' school board member Peggy Taylor said.

The Missouri Constitution limits a school district's debt to 15 percent of the taxable tangible property in that district. A proposed constitutional amendment considered last week by a House committee would allow voters to create some wiggle room. Districts could borrow more -- up to 25 percent -- if voters authorized it by a simple majority. Residents also would need to approve by supermajority vote the specific bonding plan.

Sponsoring Rep. Myron Neth said the two questions would appear on the same ballot and the defeat of one would cause the rejection of the other. He said the default cap would remain at its current level.

Neth, R-Liberty, said some large and small school districts are struggling to obtain the money needed for buildings and that increasing the bonding capacity is the cheapest way to borrow money. He said he opposes simply removing the limit.

"I'm all for local control, but we also know that there are districts and have been districts who have not been responsible with their finances," Neth said. "And I think there is some responsibility on the state level to make sure that districts don't get out of control."

The Missouri Farm Bureau, one of the state's largest agricultural lobbying interests that also advocates positions on various education issues, has opposed raising school bonding capacity.

"As community leaders, they just don't feel comfortable with increasing the debt limit in their school districts," said Leslie Holloway, a Farm Bureau lobbyist.

The Missouri School Boards' Association said the debt limit could affect several dozen schools. Spokesman Brent Ghan said helping out local districts also can boost the economy.

"There is a lot of pent-up demand in districts throughout the state for school construction projects," Ghan said. "So it would not only be beneficial to school districts that need to improve and expand their facilities, but it also would benefit the local economies in the state with additional school construction projects."

Missouri voters in April 1998 approved a measure raising the school debt limit from 10 percent to 15 percent. The measure passed the Legislature in 1997, and supporters said during a committee hearing then that the cap had not been raised since 1950.

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School debt is HJR22

Online:

Legislature: http://www.moga.mo.gov