Optimism in 2004

The nation's schools and universities have reason to be optimistic in the New Year, as the economy shows signs of clawing its way out of the hole it has been in for the past few years. While the going will be tough, especially as education institutions continue to address funding shortfalls and budgetary challenges, 2004 promises to be an active year in terms of repair and construction of facilities.

According to American School & University's 29th annual Official Education Construction Report (May 2003), about $149 billion will be spent on construction over the 2003-05 timeframe. And by examining the number and amount of construction bond issues passed over the past few years, dollars will continue to be spent on improving America's education infrastructure well into the future.

However, while myriad ballot issues to fund school construction continue to be introduced across the nation, more taxpayers are turning a critical eye to their passage.

Of the 506 school construction ballot issues proposed in 2003, 261 were approved (51.6 percent). In looking at total-dollar amount, $8.684 billion of the $16.262 billion proposed was approved (53.4 percent). This is a far cry from the 529 total bond issues and $37.58 billion in funding approved in 2002. (For a list of the top 10 bond issues passed in 2003, see p. 12.)

While there were no mega-bond issues as there were in 2002 (such as the $13 billion statewide initiative in California, $3.35 billion issue in Los Angeles, $1.41 billion issue in Dallas and $808.6 million initiative in Houston), the percentage approved in 2003 is less than the percentage passed the year before (51.6 percent compared with 62.2 percent, respectively). In addition, the 53.4 percent of the total-dollar amount approved in 2003 is significantly lower than the 83.9 percent passed in 2002.

But 2004 promises to be a year where large bond issues again will be put before taxpayers, especially in high-growth areas in the West and South (such as Los Angeles' $3.8 billion issue and California's $12.3 billion statewide initiative, both to be introduced in March).

The need to repair, modernize and add to America's education infrastructure is vital if this and future generations of students are to succeed. And while the passage of bond issues stumbled in 2003, expectations are that 2004 will be a strong year.

SCORECARD

506

Number of ballot questions, totaling $16.262 billion, local governments proposed for K-12 construction and repair in 2003.

261

Number of bond issues, totaling $8.684 billion, approved by voters for K-12 construction and repair in 2003.

53.4

Percentage of the dollar-total submitted that local voters approved in 2003 bond referenda.

51.6

Percentage of the total K-12 construction bond issues approved in 2003 by local voters.

450

Amount (in $ millions) of the largest bond issue approved in 2003 (Wake County, N.C., School District).

480

Amount (in $ millions) of the largest bond issue defeated in 2003 (Cincinnati City, Ohio, School District).

Source: The Bond Buyer

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