SUHSD Refuses Loan From County to Payback Mello-Roos Borrowing - NBC 7 San Diego

SUHSD Refuses Loan From County to Payback Mello-Roos Borrowing

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    NEWSLETTERS

    SUHSD Discusses Mello-Roos Loan Payback at Meeting

    Critics say the district borrowed from the Mello-Roos fund for purposes other than what the fund is intended for. NBC 7's Rory Devine explains. (Published Monday, Aug. 12, 2019)

    Sweetwater Union High School District officials met Monday evening to discuss whether it would accept a no-risk loan from the County Office of Education (COE) to help it payback the $12 million it borrowed from the Mello-Roos fund.

    The district refused to take the loan, and said it is in position to repay its debt to the Mello-Roos -- with interest -- by 2020.

    The fund comes from taxes on homeowners and is supposed to be used for construction, renovation and modernization of schools in the district. Some community members say the district uses it to meet day-to-day operating expenses, which is not the intent.

    Last fiscal year, the district paid back a big portion of the money it owed Mello-Roos, but it still owes $12 million. And because it did not make the payment by June 30, the district is out of compliance with the rules governing Mello -Roos borrowing.

    The district said whether it takes the county loan and pays back the Mello-Roos now or later, it will still be out of compliance. The district says it can pay back the $12 million by June of 2020, and by doing it that way, the district pays the interest to Mello-Roos which it said is, in effect, paying schools more.

    COE Chief of Staff Music Watson said that by accepting its no-risk offer, the district would've shown the community its commitment to correcting its fiscal ship.

    The COE oversees all districts to make sure they can meet their financial obligations.

    Community member Maty Adato said parts of the district are bursting at the seam as communities grow, but she says “there’s been no new building.”

    Adatoaccused the district of using Mello-Roos money as a “slush fund.” 

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