Article XI-P of the Oregon State Constitution

In this post, we look at the Oregon State Constitution, Article XI-P which is entitled "School District Capital Costs".  This article authorizes that bonds can be issued to raise funds which can be given or loaned to school districts for capital costs.  This Article has 7 sections.

Section 1

This section has 4 subsections.  The first 2 authorize that the State can issue and guarantee bonds.  Also, the repayment of the bonds cannot come from ad valorem property taxes.  This section also states that the State will provide matching funds to monies raised by the local districts which have been voter approved.  The money can only be used for capital costs and for the costs associated with the raising of the money and cannot be used for school district operating costs.

Section 2

This section specifies the possible sources of funds that will repay the issued bonds.  It specifically prohibits ad valorem property taxes.

Section 3

This section authorizes rolling over of the bonds.

Section 4

This section creates a school capital matching fund.  It is a holding place for the money so that it can be doled out to school districts when needed in a short response time.  The idea hear would be to raise a large amount of money from the bonds and then the fund would issue the money to the school districts in small lumps.

Section 5

This section defines capital costs.  The definition includes any asset that has a working life longer than 1 year.  This is really quite a short period of time and although I can see that it comes from the accounting asset definition, I do think it invites school district administrators to try and play games with the definition.

Section 6

This section directs the Legislature to enact laws to implement this section.

Section 7

This section is a catchall to prevent conflicts with other parts of the constitution from invalidating parts of the whole of the Article.