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District finance advisers outline $65 million bond capacity and urge HB 33 extension; veterans tax exemptions could affect future capacity
Summary
District finance staff and RBC Capital Markets told the board the district could seek about $65 million in a future bond authorization while maintaining the current debt-service rate, but recent veterans’ property-tax exemption amendments could change future capacity once implemented by the legislature.
Las Crues Public Schools finance staff and outside municipal advisors outlined the district’s bonding capacity and recommended asking voters for roughly $65 million authorization in the next general-obligation bond election, while continuing a longstanding $4.61 debt-service tax rate.
Eric Harrigan of RBC Capital Markets and CFO Alex Lu told the board the district’s net taxable value has grown in recent years — nearly 7% in the most recent year — which increased practical borrowing capacity. Harrigan said LCPS currently has about $147 million in outstanding bonds and lease-purchase obligations and a statutory capacity (6% of assessed valuation) that would allow roughly $279 million of total borrowing; after existing debt the district’s remaining legal capacity was roughly $132 million.
Recommendation and rationale: Given the district’s rapid debt amortization schedule, Harrigan said the district can layer new debt and still maintain its current $4.61 debt-service rate. He recommended asking voters for $65 million in authorization for the next election, which is $15 million more than the last authorization the district sought in 2021, because the tax base has grown faster than earlier projections.
State constitutional changes: Harrigan cautioned that two recently approved constitutional amendments expanding veterans’ property-tax exemptions could reduce net taxable value statewide. One amendment links the percentage exemption to a veteran’s disability rating (extending partial exemptions to disabled veterans who are less than 100% disabled) and the other raised the general veterans exemption from $4,000 to $10,000. The legislature must enact implementing statutes; Harrigan said staff anticipates the full effect will be clearer once the legislature acts and that the first material impacts may arrive in the 2026 tax year (FY2027). He said the district modeled conservative assumptions and still concluded a $65 million question is supportable now, but that future elections could be affected by the exemptions’ ultimate impact.
Board questions: Members asked whether the district has finalized the capital projects for potential ballot measures. Harrigan and staff said district teams are still prioritizing projects and refining cost estimates; staff noted Title IX and facility needs will be weighed with other capital priorities. Member Ed Frank and other board members said they want priorities and project lists completed before public outreach and bond planning.
No formal vote was required; this was an informational presentation. Staff said they will return with project lists, cost estimates and a proposed ballot plan for board consideration.
