The Finance Committee of the District 65 School Board discussed proposed capital projects for the summer of 2014, against a backdrop of a steadily declining amount of funds available for capital projects.
Mary Brown, chief financial officer for the District, told committee members that the District can currently issue bonds to pay for capital projects up to $10 million under its Debt Service Extension Base (DSEB), without the need for a referendum. That amount increases by about $2.5 million each levy year.
Dr. Brown also presented a proposed schedule of capital projects for the next four summers, which includes a cumulative total of $6.5 million for technology; $5.2 million for roofing/masonry projects; $4 million for safe entrances to schools (including reconfiguring space), asbestos abatement and some additional projects; and $1.4 million for District supervision and bonding fees.
At the end of the summer of 2017, the proposed schedule estimates the District would have capacity to issue only about $2.8 million in bonds. A year ago, Board members expressed a desire to keep the District’s bonding capacity at about $5 million in case of an emergency.
In light of the limited funding available, Board members struggled with some of the capital projects proposed for the summer of 2014. The main focal point was to choose between alternative ways to construct a safe entryway and reconfiguring space for Chute Middle School, one which had an estimated cost of $475,145 and the other $714,700. Jim McHolland, principal of Chute, said the second option would provide a more flexible reconfiguration of office space and better traffic flow when students were entering the building in the morning.
Board members at the Finance Committee meeting all favored the more expensive option, as a better long-term solution at Chute. They also supported replacing the metal gates at the north end of the building with glass.
While supporting the remaining projects that were proposed for the summer of 2014 and that had an estimated total cost of approximately $450,000, the Committee decided to obtain “alternate bids” for those projects so they would know the actual costs before making a decision.
On Sept. 23, the Board approved obtaining bids to provide a safe entrance (and reconfigured space) at Chute, to air condition certain areas and to replace the gate at the north end of the building with glass. The Board also approved obtaining separate bids to provide safe entrances at the Joseph E. Hill Administration Building and Kingsley School, to add glass windows and doors on the south side of Chute, to patch or alternatively replace a small parking lot at Lincoln, and to do asbestos abatement.
Richard Rykhus, chair of the Finance Committee, said until bids were approved, the Board has not committed to any project.
Dr. Brown said the “draft schedule for the summers of 2014-17 covers only a small scope of the District’s identified capital projects,” due to the limited amount the District may borrow under the DSEB, and the District could exhaust its borrowing capacity under its DSEB before the four years expired.
As an example, she said the total estimated cost of roofing and masonry work is $23.9 million, which is scheduled to be done over an 18-year period in attempt to keep the cost within the District’s DSEB. “If any of these areas deteriorate faster than anticipated, more of the DSEB will be needed to address this work earlier than planned.”
Dr. Brown also said there was more than $16 million of remaining projects that were identified during the last 10-year life safety survey that was conducted in 2005-06 school year. The next 10-year life safety survey will be needed in the 2015-16 survey “which is likely to result in additional identified projects,” she said.
Dr. Brown added that while funding through the DSEB is “quite limited,” the District could substantially increase the amount of borrowing to pay for capital projects through a successful referendum. The School Board has not discussed a referendum.