Rau Responds To Nesberg On School Referendum Questions

At the polls on Nov. 8, voters of Peshtigo School District, by by a margin of 1,751 to 982, approved a referendum authorizing the School District to issue bonds totaling not more than $39,950,000 to finance a major overhaul and expansion of the existing high school building. The approval came after several announcements by District Superintendent Patrick Rau and others at public meetings that the property tax impact would be $29 per $100,000 of equalized value per year.

Then, when the property tax bills came after the election, property owners in the school district saw that the increases on their property tax bills were far higher than $29 per $100,000 that they had expected. Many of them were unhappy, and that included former school board member Mary Lou Nesberg. She asked to be on the agenda for a subsequent board meeting and was refused. She then submitted a list of questions, in writing, to the school board at its monthly meeting on Wednesday, Feb. 8. On Feb. 21, Rau wrote a response to Nesberg’s questions.

Question 1 of Nesberg’s original questions was: “The referendum was passed in November, our taxes are for 2022, is the increase in our school taxes prorated for the months of November and December? If so, just wondering what that will do to next year's taxes. If not, why are we paying for 12 months when it only took effect for two months?

Rau replied: “The property taxes collected at the end of 2022 are to fund the 2022-2023 school district budget. The property taxes you pay are for a calendar year, however it funds the school district's fiscal year, July 1 to June 30. Taxes are collected by a municipality and then paid to the district in four different installments with the first tax revenue received by the district being in January.

“It is important to understand that a public school district does not receive all of its funding in one lump sum at the beginning of the school year. Throughout the year the district receives varying portions of state aid in addition to the local property tax revenue collected in four installments.

“The first payment on the principal of the debt for the Middle/High Building Project is due March, 2023. Principal payments on the referendum debt are made annually in March and interest payments are made in the falI. This timetable is used because school districts fund the debt through the issuance of bonds. Thus, the debt levy was included for the 2022 property taxes to allow the District to makes its first initial payment in March, 2023.”

Question 1 on Nesberg‘s second set of questions was: “I pulled up a map off the Marinette GIS site and looking where the remodeling and buildings are at the high school. I was confused because I notice some of the new construction was on new city property. I never saw or heard of that being mentioned and was curious if you had to get permission for the new construction on city property? And did you?”

Rau said they were aware that its current building, parking lot, storage shed, driveway, and green space are on city property, and added, “This has been true for nearly 40 years with the last addition to the middle/high school. The parking lot and green space being located on city property could be for much longer than that.”

He added, “Unfortunately, the District does not have any record of the circumstances leading up to the building, parking lot, out-building etc. being built on city property,” and continued, “Since the successful referendum, the District has completed a survey and has had preliminary talks with the mayoral office about the transfer or vacating of the property. Legal counsel has been retained to assist with the process as well. TheDistrict also understands that the original plan may have to be altered if no agreement can be reached with the City.”

Question 2 was: “Regarding the $29 per $100,000 (of assessed value) issue, honestly did you all know what that exactly meant?”
Rau said they did, and added, “However, the District does not have access to an individual's property values, nor did the District know how much the fair market value on residential properties was going to Increase. It appears individuals in the community were unaware of the increase as well. If a resident did not account for their property to increase in fair market value, the estimated impact would have been miscalculated.

Nesberg’s Question 3 was “Why can't you rescind your motion of accepting the results of the referendum and re-do it with more accurate Information?”

To this, Rau replied, “The information provided to the district residents was accurate. In an effort to inform the community about the needs for, the scope of, and the tax impact of the project the District used direct mailings, videos, radio broadcasts, and social media. The District also hosted open houses, attended community gatherings and civic meetings, provided updates at school board meetings, and posted extensive information on our website in an effort to answer questions. The District's goal was for every resident to cast an informed vote and be part of the process.”

He added, “Based on the approval of the middle/high school referendum on November 8, the Board believes the majority of the community has spoken.”

The fourth and final question asked by Nesberg was in regard to a comment Board President Gary Larsen had made on social media that the referendum could not be redone “... because no bank would ever borrow us money again.” Nesberg asked for an explanation of what Larsen actually meant.

The reply from Rau’s office was that the comment Nesberg referred to was reported In an article printed in the Eagle Herald on January 26 as Larsen's response when asked if the board could rescind the vote on the referendum? “He was quoted In the Eagle Herald saying, ‘We'd never be able to borrow money again, nobody understands.’ 

Rau said with that response, “...Larsen spoke to one of the outcomes if such an action would take place and he is correct. $26 million for the Initial phase of the project has already been borrowed and bonds issued. Prior to the borrowing, the District had to provide a substantial amount of financial records, policies, and practices for a bond rating. An action to borrow money, issue bonds, and then rescind a referendum that the majority of residents voted in favor for would have a detrimental impact on the District's bond rating.”

Rau invited anyone wanting more information regarding the responses to contact him at 715-582-3677 or raup@peshtigo.k12.wi.us.
Nesberg was not totally happy with the answers, which she noted came nearly two months after she had first asked.

She also said some of the questions were not really answered, and pointed out she had not asked if the School Board members were aware that the school facilities occupied property owned by the City of Peshtigo, she had asked if they had gotten permission for the new construction on City Property, and added, “...and the answer that was given was sure different than the answer Mr. Rau gave me after the February Board meeting.”

Regarding the answer given for question #2, Nesberg said word "However'' maybe should have been the word used “when they were pushing the $29 per $100,000.”

Nesberg said, “Regarding the answer they gave for Question No. 3 with their little comment on the end: ‘Based on the approval of the middle/high school referendum on November 8, the Board believes the majority of the community has spoken.’ and then asked,  “Are you kidding me, apparently you aren't listening to them now, when you should be, after being misled and being very confused when we received our taxes.”

She went on, “Regarding the answer they gave for No. 4, nowhere does it say that a bank would never loan us money, they say it would have a detrimental impact on the District's bond rating,” and added, “... so stop lying.” “Respectfully Submitted on Behalf of the Peshtigo School Board, Nesberg declared, “I don't believe that for a minute, but that is totally my personal opinion,” and then asked, “Did the Board have a meeting with all members to address these answers or just a chosen few?

Nesberg concluded by stating that the comments she had added were her own personal opinions, “...the rest of you can make up your mind when it comes to election time...But I did try to get the answers for you.”