Ann Arbor Public Schools Comprehensive Facilities Plan
Bond/Sinking Fund Proposal

Official Policy
April 27, 2004 

The Ann Arbor Area Chamber of Commerce supports the Ann Arbor Public Schools (AAPS) $240 million Comprehensive Facilities Plan, comprised of a 5-year $35 million sinking fund and a 25-year $205 million bond package, which will be submitted to the voters this June.    

The Chamber recognizes that local taxes are a significant burden and believes that any tax proposal should be evaluated with skepticism. The Schools were asked to demonstrate that their proposal was rational and reasonable and, on balance, they have done so.

The Chamber and the community understand the importance of quality public education. It is clear that the Ann Arbor Public Schools have real needs for facilities improvements. With the expiration of existing taxes in 2005, the time is ripe for a new schools funding proposal. The question is whether the Comprehensive Facilities Plan is the right plan. 

Members of the Chamber’s Board of Directors, the Chamber’s Public Policy Committee, and School Task Force and staff devoted substantial time to review and discuss information provided by the Schools. Within the limits of time and expertise, the Chamber has tried to determine if: 

• The proposed expenditures are necessary
• A new high school is the best alternative to current overcrowding
• The proposal is financially sound
• The Schools will be able to operate as planned without additional new taxes

 While the overall tax burden in Ann Arbor remains an issue of great concern, it appears that the tax burden attributable to the Schools would be consistent with that of similar communities if the Comprehensive Facilities Plan is approved. The price of the proposed new high school appears to be consistent with that of similar facilities built recently in nearby communities. 

The Chamber would have preferred to see a series of ballot proposals that would have offered voters more choice as to the scope of expenditures they would approve. The Schools have chosen to offer a single, integrated financing plan.

Nevertheless, the Chamber has determined that the Comprehensive Facilities Plan should be approved. The Schools demonstrated they undertook a thoughtful process to determine the scope of the Plan. There was a significant degree of community involvement and there was an effort to limit proposed expenditures. While we could question details, on balance it is a good plan.  

While the Chamber supports the Plan, voters should understand that the school district will likely seek renewal of the sinking fund (1.0 mill per year for five years) when it expires.  The expenditures that it will fund are, by their nature, ongoing. There are also items being purchased out of bond funds that may end their useful life long before the bonds are paid. Replacements for such items will likely need to be purchased with new additional financing or out of future sinking funds.

A quality education system is certainly a business issue, both in producing skilled workers for the future, and in enabling businesses to attract the employees of today.  But quality education is not purely a matter of a high level of spending. The Chamber generally does not, without serious consideration of the issues involved, endorse increases in taxation of our members-- particularly on the scale of the Comprehensive Facilities Plan.  The $240 million cost of the proposal, the fact that the community won’t have an opportunity to vote on the separate aspects of it, and the countless number of chamber members who have asked for more information on the plan, all make it essential for the AAPS to provide the public with the detailed information that assisted the Chamber in developing an educated and meaningful position on the Comprehensive Facilities Plan.  Having reviewed that detailed information, we recommend that our members support the Comprehensive Facilities Plan.