Voters in Orem, Utah, will decide whether to leave the state’s largest school district and create their own after the city council voted 4-3 Tuesday night to place the measure on the Nov. 8 ballot.
But even with a new district, taxpayers in the northern Utah city would still be on the hook for about $105 million of outstanding debt issued by the Alpine School District, which has proposed putting a $595 million bond referendum on the ballot as well, according to a study commissioned by Orem.
The study, which concluded that a split from Alpine and the formation and sustainability of a district within Orem’s boundaries is feasible, said the city’s share of the new bonds, if approved, would be $116 million over the next 20 years regardless of where the proceeds were spent.
There was no immediate comment on Orem’s decision from Alpine, which serves students in 14 cities.
Ahead of its vote, the Orem City Council heard from dozens of residents for and against the move.
Council Member Tom Macdonald raised concerns about the unknown costs. “I would not vote for a split if it raises taxes and this will,” he said.
But other council members favored a split, saying test scores were declining and class sizes were increasing. They also said the district has failed to fix school buildings in Orem that were identified by the Federal Emergency Management Agency as being unsafe in the event of an earthquake, while it targets bond proceeds for school projects outside of Orem.
“The real issue is whether you want your children to benefit from your tax money,” said Mayor David Young.
The study found that from 2006 through December 2021, $312 million of Orem property tax revenue flowed into Alpine’s capital and debt funds, while reinvestment in school buildings in Orem, which accounts for 19.44% of the district’s property value, totaled $189 million.
It added that a new Orem district would be sustainable based on the assumption that its property values, which climbed 25.3% this year, will continue to rise in the future.
Alpine operates 61 elementary schools, 14 junior high schools, 11 high schools, and seven special purpose schools serving approximately 84,111 students. Orem students accounted for about 14,882 of the attendance in the last school year.
As of Nov. 1, the district had $505 million of outstanding general obligation bonds rated triple-A based on a state of Utah guarantee, and $50 million of lease revenue bonds.