Thursday, March 27, 2008
There are good arguments for both options, but after listening to everyone speak, I tend to agree with those who want to keep the high school at the current site. The most compelling arguments to me are that it is adjacent to the university (with access to its facilities) and is centrally located.
The consensus seems to be that Fayetteville deserves a world class high school for the 21st century. One of the proposals is to build a new building across the street from the current structure and renovate the current structure. This (to me) seems like a good compromise between those who want a totally new building and those who simply want to renovate the old HS.
The site in NW Fayetteville just seems too far for many students, especially those on the east side of town. If there were to be a new high school on a new site, I guess I would favor the Morningside site between Huntsville Road and 15th St. This is still centrally located.
For those who are interested in some of the working papers on this issue, the Fayetteville schools site has downloadable files:
The issues are extremely complex, but I was impressed by the dedication of the committee in considering all points of view. There will be another public meeting on April 3 at a site yet to be determined.
For more information about the meeting and different points of view on the issue:
Tuesday, March 25, 2008
The Future of Fayetteville High School is an important issue in our community, so please come out and express your opinion.
If you would like more information about this issue you can go to the Future of FHS website at:
Almost a year has passed since the Fayetteville School Board voted to remain a one high school district and add grade 9 to the mix. At that time the big question was where would that one school be located. Should the existing site be renovated and enlarged? Should a brand new school be built elsewhere? If elsewhere, just where would that be?
Fast forward to 2008. It seems the questions are exactly as they were. But the options have been narrowed down some. Two potential sites for a new school have been eliminated: a parcel south of 15th St. off Morningside Drive because of large areas of flood plain on the site as well as a sewer line through it, and a 94-acre parcel south of the Cliffs Apartments off Crossover Road because the owner of about 1/3 of the tract is not interested in selling.
As of now three sites remain in contention: the property north of 15th Street and south of Huntsville Road on Morningside Drive; a property the district already owns on Deane Solomon Road; and the current high school location.
A committee consisting of citizens, teachers, and students has been appointed to study the question of location. It is scheduled to make its recommendations to the board in April 2008. In addition to answering the big question, it has also been charged with determining at what point the new or improved high school should open.
But it’s not just question of building a new school or enlarging the old one. One problem has to do with streets to access the school. No matter which site is selected, the school district will also have to contribute to improving roadways for access to the school.
Members of the committee met with City of Fayetteville officials on March 12 to discuss what improvements would be necessary and a timetable for the improvements. According to Tim Conklin, city planner, it costs between $1 million and $1.3 million per lane mile to widen a two-lane road to a four-lane road. Additional challenges for the streets around the current site include the fact that they are narrow and wind through residential neighborhoods.
A second problem is the question of whether the University of Arkansas would buy the existing high school. The school board needs to know if U of A is serious about purchasing the property, and if so, how much would they pay. In my mind, it seems like a logical choice for the university. There is no other contiguous land available to enlarge the university campus.
But here’s the catch. The school board doesn’t yet know if it wants to sell the property and the university either doesn’t know if it wants it or won’t commit to buying it until the school board makes a decision.
Then there’s the question, again, of what size high school is necessary. If a new school is built, how many students should it accommodate? The growth rate in Fayetteville school district is currently negligible. In fall 2000, there were 2,474 students in grades 9-12. According to the most recent figures I saw, there are only 37 more students now – which is seven years later.
At that rate, it would take many years before capacity would be reached in a school for 3,000 students. Even more astounding is the statement that it would take 50 years to reach capacity if the school is built for 3,200 students!
Finally, the issue has polarized the community. Two grass roots organizations have formed, Build Smart (supports keeping the high school at the current location and opposes selling the current site to the University) and Fayetteville Students First (favors a high school at a new location, selling the current site and using the money for a down payment on the new school). Both groups are collecting signatures on petitions in support of their respective positions.
So it’s obvious there is a monumental amount of work to be done before many crucial decisions are made. There is one certainty, however. There will probably be a tax increase to fund whichever option is finally chosen. It behooves everyone to become informed. I cannot think of anything more important to a community than the quality of its education system.
For more information:
Wednesday, March 19, 2008
The first, and most important, thing to understand is that the Federal Funds Rate is simply a suggested rate of interest that one bank can charge another bank for an overnight loan. At the end of each business day, banks must have certain amounts of cash on hand to meet reserve requirements as set by law. One bank may need to borrow to meet the requirements, while another bank may have surplus funds available. Banks can negotiate the actual interest rate on these overnight loans – they are not forced to charge the Fed Fund Rate.
Secondly, one has to realize that an overnight loan is extremely short-term while a 30-year fixed-rate mortgage is an extremely long-term loan. It is easy to commit funds at a certain rate for a short term but it is much more difficult to determine what the rate should be for a long term. Many factors such as anticipated economic growth and inflation rates must be taken into consideration in setting a rate of interest that would draw investors.
Now we have to take a look at U.S. Treasury Bonds. As we all know, T-Bonds are backed by the full faith and credit of the United States Government. In other words, T-Bonds are a risk-free investment. T-Bonds serve as a benchmark risk-free interest rate. Investors (you, me, professional money managers and everyone in-between) want to get the best possible return on their money based on the amount of risk involved.
Given the fact that the average length of a 30-year fixed-rate home mortgage is actually about ten years, it makes sense to compare investing in home mortgages (with risk) to 10-year fixed rate T-Bonds (no risk). The interest rate has to be higher on the mortgage securities or no one would invest in them.
As the number of foreclosures and defaults has increased (increasing risk), mortgage interest rates have had to go up in order to attract investors. This is the so-called “secondary market” for mortgages.
As many people who have purchased homes can attest, often the bank that gave the buyer the mortgage is not the bank to which buyers are making their payments. Shortly after closing, often buyers get a letter explaining that a different bank now has their mortgage. This is because the original bank sold their mortgage to another financial institution.
Many factors affect movement in mortgage rates – not the least of which is competition for money. An investor has money and a homebuyer needs to borrow money. Where can the investor get the best return?
This has been an overly simplified explanation of a very complex subject but I hope it helps at lease partially explain why changes in the Federal Funds Rate as discussed in the press have almost nothing to do with the mortgage rate.
For more information:
Sunday, March 16, 2008
The increase would have made the district’s millage rate 44.09 mills, the seventh highest rate in Arkansas. Owners of a home valued at $200,000 would have been taxed an additional $160 annually if the measure passed.
(For sake of comparison - Springdale’s rate is 38.6, Rogers’ rate is 38.7, and Fayetteville’s is 43.8. However, that may change as all three districts are considering the possibility of passing millage increases to build new schools.)
Bentonville’s millage increase would have permitted a $209 million bond to purchase land, build six schools, make improvements to existing schools, and provide technology upgrades. In addition, some of the money would have gone to operational costs.
The district also planned to restructure existing debt.
In 2002 Bentonville voters approved a $110 million in funding to construct of five schools, athletic facilities and an addition to the high school. Since that vote, growth has been almost unstoppable. The number of students increased by 1,100 in 2005-06 and another 841 this school year.
A failed millage increase this year undoubtedly means the district will have to make some revisions and ask for another increase next year.
For more information:
Tuesday, March 04, 2008
It’s hard to get accurate data on foreclosures in Arkansas these days. The national media would have us think that every home on the market is being foreclosed on so all buyers need to do is make a "low-ball" offer and get a "steal," but it’s not true. Regular homes for sale are still maintaining fair prices, and although homes are no longer appreciating in NW Arkansas at the double digit appreciation rates of the past few years, they aren't depreciating either.
Awhile back I had some data which indicated that the foreclosure rate in Arkansas was actually lower recently, but now I have some new, but confusing information.
According to my new information, the 2007 foreclosure rate in Arkansas was 26.44% higher than 2006 according to Realty Trac, a well known company that maintains a database of more than 1 million properties nationwide that are in various phases of foreclosure. These statistics include default notices, auction sales, and repossessions.
The report showed 14,310 foreclosures in Arkansas last year, up from 11,318 in 2006, which ranks Arkansas 26th in the country.
States with foreclosure rate increases in excess of 200% include California, Delaware, Maryland, and Nevada. (The 200% is not a typographical error.) Washington, DC topped all the states with a whopping 608% increase!
Overall, nationwide foreclosure filings increased 79% in 2007 over 2006. Comparatively speaking, Arkansas looks pretty good with an increase of “only” 26%.
Nationwide, more than 1% of households were some stage of foreclosure. The foreclosure rate in Arkansas for 2007 is 0.51%, again a rather respectable ranking compared to many parts of the country.
Within Arkansas, foreclosure rates vary greatly by county. For example:
*Benton County saw a 105% increase, from 905 in 2006 to 1,855 last year. To put that in perspective, there was one foreclosure for every 41 households.
*Washington County increased 108%, from 567 to 1,177, - one foreclosure for every 65 households.
*Sebastian County (Fort Smith area) had a 4% drop in foreclosures, yet that was one foreclosure for every 66 households.
*Crawford County (Van Buren area) rate dropped 13% but that was one foreclosure for every 64 households.
Thus, you can see, simply looking at the rate of increase/decrease is not indicative of the number of households affected.
The official records of Benton County show only 509 foreclosures in 2007, down from 541 the preceding year. Two things can explain the discrepancy from the 1855 stated by the reporting firm and the county’s figure of 509:
The reporting firm included both judicial and nonjudicial foreclosures. In judicial foreclosures, the sale of the property is administered by the court system. In nonjudicial foreclosures, the sale is handled by an appointed trustee and filed with real estate records, which keeps it out of the Arkansas courts. Beginning January 1, 2008, a change in law requires nonjudicial foreclosures to be filed through the court system.
The reporting firm also included properties that may be only in default but counties do not record defaults. Thus, many of the defaults of fourth quarter 2007 won’t be included in county records until foreclosures enter the legal system in 2008.
So we don't know how many foreclosures there really are in NW Arkansas. But there are a bunch.
The bottom line here is that for buyers there may be some really good dealsfor buyers out there if the home they want to purchase is a “bank-owned” property. Foreclosed properties listed by realtors generally try to recoup what the bank has lent, so the list price may be substantially less than other similar homes in the same neighborhood. A clue to whether this may be the case is that MLS public remarks usually say something like “corporate owned” in the description.
For more information: