Posted on: Thursday, October 10, 2002

ELECTION 2002
Teachers union urging 'No' vote on amendment

By Jennifer Hiller
Advertiser Education Writer

The public schoolteachers union yesterday pitted itself against Hawai'i's 130 private schools in the fight over a proposed constitutional amendment that would help finance private school construction projects at lower interest rates.

The Hawai'i State Teachers Association is urging voters to cast a "No" vote Nov. 5 on ballot question two, which would allow private schools to use the state's special purpose revenue bonds to finance construction projects. The HSTA argues that the measure takes attention away from a $600 million deferred maintenance problem in the public schools, benefits a small group of select students and blurs the lines between public and private.

Private schools say the measure would cost the state nothing and bring more construction jobs to Hawai'i through the renovation of aging schools.

"It doesn't take anything away from public schools — not attention, not resources, not work," said Robert Witt, executive director of the Hawai'i Association of Independent Schools. "I think HSTA needs to move from the old worn-out attitude of us against them that doesn't work for anyone in this state. Every child in this state deserves to go to a nice school in the morning."

Karen Ginoza, HSTA president, said the union bears no ill will toward HAIS or private school teachers and students. Instead, she said the issue if one of priorities. "Too many of our children attend classes in schools in desperate need of repair, yet there is no proposed solution for this shameful backlog on the Election Day ballot," Ginoza said.

Special purpose revenue bonds already are sold by the state to provide financing for utilities, private preschools and hospitals run by nonprofits and low-income government housing.

Ginoza said the private schools system does not rise to the same level of serving the public good as those other institutions.

"It is in the best interest of everyone to have access to electricity, clean water, childcare options and adequate healthcare. These services bring benefits to all," Ginoza said. "Private schools simply cannot make that claim."

Witt said that private schools serve a variety of students and noted that about 40 other states already offer special purpose revenue bonds to private schools. About 34,000 students in kindergarten through the 12th grade attend private schools in Hawai'i. The number increases to more than 50,000 when the colleges are included.

There are 183,000 children in the public schools.

Public school teachers and private schools were on opposite sides last spring as the bond measure moved through the Legislature, but campaigning for or against the amendment has been low-key since the end of the session.

Now, however, the HAIS is rolling out television ads, some of them starring 2001 Miss America Angela Baraquio, who was the athletic director and a teacher at Holy Family Catholic Academy before she won the crown.

HSTA will counter with radio ads in response. "We don't have the funding the private schools do to run the television ads," Ginoza said.

Joan Husted, executive director of HSTA, said she is concerned that the lines between public and private would blur if the measure passed. HSTA also opposes a bill that will allow Kamehameha Schools to run conversion charter schools for the same reasons.

But private schools say the bonds could help them finance construction projects they might not otherwise afford.

Nancy Barry, principal at Ho'ala School, said her 131-student campus has been renting space from the Wahiawa Hongwangi until it can build a separate campus. The school already has completed a classroom building on its own 2.2-acre site, but still needs work done, including fire hydrants, before the students can move.

"The special purpose would really benefit us," Barry said. "We're trying to get the last of the site work on the property. A school like Ho'ala has been very blessed with trust and foundation support, but it's hard to go out and get additional money through a bank loan to try to complete the fundraising. We're small. We don't have a big endowment."

A 2001 report from the Legislative Reference Bureau said the bonds would not directly cost the public schools money. Only if Hawai'i residents bought the private schools bonds whose interests are tax free would less money go into the state's general fund, the report said.

"People who invest in bonds are going to invest in bonds no matter what," Witt said. "If they're going to invest in a tax-free bond, why not invest in one that will benefit schoolchildren and create construction jobs?"

The state makes a capital improvement loan by selling special purpose revenue bonds to private investors, who provide the money for the project and bear the risk of nonpayment in return for interest payments that are exempt from both federal and state income taxes.

Because the interest on the bonds is tax free, investors are willing to lend money at lower-than-usual interest rates, saving schools money. Schools can receive loans that are about 25 percent below commercial rates.

The Legislature has the authority to review and approve or discard special-purpose revenue bonds.