This year is shaping up to be a big one for the passage of bonds that support school districts, according to a group that tracks ballot items that deliver money for education.
With federal stimulus dollars expiring, school systems are facing new financial hurdles, and the receipt of funding through measures approved at the ballot is likely to prove crucial to their budgets in the near future.
Rachel Moya is the chief revenue officer for The Amos Group (parent company of SchoolBondFinder and SchoolNetwork). SchoolBondFinder is a comprehensive online database tracking K-12 bond–funded projects in the United States for solution providers.
Voters across the country will decide 623 school bond initiatives on the Nov. 5 ballot. Those referendums carry an estimated pricetag of $84.68 billion, according to The Amos Group, which tracks the measures through the online databases SchoolBondFinder and SchoolNetwork.
When including the K-12 bond measures that have already been approved by voters earlier this year, the 2024 amount could surpass the roughly $96 billion that school districts received from bond referendums two years ago. And 2022 was a “banner year” said Rachel Moya, chief revenue officer for The Amos Group.
“The general consensus, looking at what’s projected, looking at what’s already passed this year, is that we are going to meet or exceed 2022’s numbers,” she said, noting that districts have already brought in close to $35 billion this year from voter-approved referendums.
The increase in voter-approved bond measures for K-12 is likely to mean more opportunities — and competition — for companies that do business with school systems.
“School districts have the capability to be very selective with who they choose to partner with on these large-scale capital projects,” said Moya.
EdWeek Market Brief spoke with Moya about her impressions of what’s at stake for school bonds this November, and what it means for the K-12 market.
What have you been seeing in terms of what voters are approving for school bonds in recent years?
We’ve had a steady increase in the quantity [of bond items], and dollar amounts over the last decade or so. Things have definitely been increasing, and the last four years were pretty remarkable in terms of what was passed and the local dollars that are flowing for these capital projects.
What’s the reason for the uptick in recent years?
The cause of the uptick in the last four years is likely the increased attention and awareness that the public has and school districts themselves in [funding schools]. There is a renewed public interest in looking at the health, safety, and security of their facilities due to Covid. So that was a good thing that came out of the pandemic — that the public recognizes they want clean air, and they want secure schools.
They want to make sure that the school districts have flexibility in their learning spaces. School districts are certainly going to take advantage of that in a good way to make sure that they have what they need.
A big thing that's important for school districts is the flexibility in their learning spaces and the use of certain rooms for multiple purposes.
Is there typically an increased number of referenda on the ballot during a presidential election year?
Traditionally, yes.
How likely is it for these initiatives to pass or fail, in general around the country?
Presently, we are sitting at a 76 percent passage rate this year to date. It’s been around 76 percent or 77 percent for the last few years as well. So you can anticipate that around 76 percent of those on November 5th will pass.
Isn’t it true that not all school bond elections happen in November?
Correct. That’s a very important thing to note, too. The peak times of year that we see initiatives go to vote are going to be be in May and November. However, that’s just on average, and that’s because of school districts taking advantage of increased voter turnout during those general or primary elections and the November elections. You’re going to see them occurring in different parts of the country throughout the entirety of the year.
What trends or takeaways are you seeing in terms of projects that taxpayers have been approving through these measures so far in 2024?
For the last five years, safety and security initiatives are largely passing. HVAC, as well, is another area of expenditure that has continued to see an increase. CTE [career-technical education], vocational, and STEM spaces are also up there.
A big thing that’s important for school districts is the flexibility in their learning spaces and the use of certain rooms for multiple purposes.
What are some of the bigger initiatives that have passed so far in 2024?
The largest that have passed are going to be in Texas, California, and Washington. Those three states have passed the highest-dollar bond initiative so far this year. California so far has passed that one with the highest dollar amount attached to it. That was in March of this year in the Desert Sands Unified School District. They did new construction and renovation of their classrooms, science labs, STEM and CTE (career and technical education) facilities, emergency communication systems, smoke detectors, fire alarms. That was $675 million.
2022 was a banner year for passing of school referendums, and 2024 could surpass that. Does that give any indication for what 2025 could look like?
We actually have some early indicators of that. We track everything that is proposed as well as everything that’s on what we call our watch list. And on our watch list already for 2025 … we’ve already got 88 [referendums] that we’re tracking right now for 2025. Odd numbered years are slightly lower than their even counterparts, so I anticipate it’ll be slightly lower than 2024.
But given the growth that we’ve seen in the last few years, it will be higher than prior odd number years.
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Does the uptick in bond approvals change the landscape for education companies bidding on projects?
For the vendors, there’s obviously a ton of opportunity, but I do anticipate that it’s going to be much more competitive. You’re going to have new players entering the market every year, and you’re going to also have those that have been around for a long time.
What advice would you give vendors that are trying to read the bond landscape and work with districts that approve them?
School districts don’t run these [bond elections] every year. It’s often something that they’re doing on a cyclical or long-range plan, or maybe it’s the first one that they’re running in 20 years. It’s a very high-stakes arena for superintendents and those that are executing these at the district level.
The companies that they partner with really need to be on their A-game and making sure that they are meeting the needs of the district, coming in on time with their deliverables, and executing these projects pretty well so that the school districts are able to, if they need to in the future, run them and see success again.
Will the end of stimulus funding, and the financial pressure districts are coming under, have an impact on school district bond elections?
ESSER may have been utilized by some districts to offset their total dollar ask of the local electorate when they went out [for bonds] the last few years. That was something that we saw in our records — that the school districts were saying, “OK, we’ll use 20 million to upgrade our HVAC from ESSER because it was a permissible use, and we’re only gonna ask the public for 80 million to do the rest of our other capital projects.” [Now,] they’re not going to have that capability to offset the total dollar ask, and will essentially push that back onto the local electorate.
