DALLAS - Voters will consider the largest school bond issue in Texas history after the Houston Independent School District board of trustees agreed to place a $1.9 billion debt question on the November ballot.
The 8-1 board vote Thursday came after HISD's chief financial officer Melinda Garrett revised her estimate of the property tax increase needed to support the debt. Previously, she predicted a 7 cents per $100 increase. But on Thursday, she lowered that to 5 cents, with no increase until 2014.
The school bond vote is expected to coincide with a proposed $410 million city of Houston bond proposal that is one of the smaller issues to appear on Houston ballots in recent years. The Houston City Council must approve that issue by Aug. 20 for it to appear on the ballot.
HISD Trustee Greg Meyers , who cast the only vote opposing the issue, said the plans for building and remodeling schools lacked sufficient detail.
Board members debated whether new schools would be built at the right size based on student enrollment projections and whether the budgets were appropriate. The district spent about $1.25 million on a facilities study.
Rice University political science professor Bob Stein, who has polled voters about the bond proposal on behalf of HISD, said that 48% of polled voters supported a $1.8 billion bond and 28% opposed it. A large turnout is expected because of the presidential election.
Among the top projects would be an $80.2 million high school for the arts and a school for the health professions in Houston's Medical Center complex for $64.5 million.
The proposal is the largest single school district request to go to voters in Texas, taking the top spot from the Dallas Independent School District's $1.41 billion GO plan approved by voters in 2002. It is the eighth-largest school bond request ever in the United States, outpaced only by districts in Los Angeles and San Diego.
HISD's school bonds currently carry underlying ratings of Aaa from Moody's Investors Service and AA-plus from Standard & Poor's but get top ratings and stable outlooks from both agencies because the Texas Permanent School Fund guarantees most school bond issues in Texas. Fitch Ratings does not rate the debt.
As the state's largest school district, HISD has $2.3 billion of general obligation debt and $118.9 million of lease revenue bonds issued by the Houston Independent School District Public Facility Corp.
"In our opinion, the district's above-average debt levels and significant capital needs are factors that limit the rating at the current level," wrote Standard & Poor's analyst Horacio Aldrete-Sanchez in a report on a $187 million refunding in April.