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On March 2, the District 65 School Board approved issuing approximately $5 million in bonds to fund building work and technology, but did not approve spending those funds. Administrators had recommended capital projects totaling $5 million for the summer of 2015. These projects had been prioritized during a series of Finance Committee meetings. Board members, though, wanted to take a look at additional information to see if the list of projects could be narrowed or costs reduced even more.

At the Board’s Finance Committee meeting on March 9, administrators narrowed the projects and costs to $4.5 million, but members of the Board looked for ways to reduce even that amount.

Faced with a limited amount of funding available to spend on capital projects, the Board has been striving to cut costs at every corner.

Proposed Projects

As revised, the proposed building work for the summer of 2015 includes roofing work at Oakton School ($1.2 million), installing an underground school storm-water detention system at Lincoln School ($733,000), replacing an elevator at Haven School ($130,000), removing a shed at Kingsley School ($59,000) and various other lower-cost projects.

The Finance Committee decided to move forward with installing an underground storm-water detention system at Lincoln School last year, because the use of a detention pond there deprives students at the school of any play field for most of the year. While there was a concern whether this project could proceed during the summer of 2015 due to new permitting requirements of the Metropolitan Water Reclamation District, it appears that the timing can be worked out. Board members asked that an alternative option presented by the District’s engineer be explored to see if it would reduce costs. They also asked that a walking path be bid separately so they could evaluate whether to proceed with that part of the project.

Several Board members questioned the need to remove the shed at Kingsley. Mary Brown, assistant superintendent of business services, said the shed is not being used, it is in disrepair, and it appeared that homeless persons were using it, creating a safety issue. Administrators initially proposed replacing the shed at a cost of $125,000; the proposal is now to remove it, and to seed the area with grass at a cost of $59,000.

Several Board members expressed concerns about the technology expenses which are pegged at $1.9 million. Board member Claudia Garrison said she would like information showing how much students and teachers are using the technology and whether it was improving student achievement. Members of the Board appeared inclined to move forward with those expenses, which include purchasing new Chromebooks for student use. They decided, though, to defer approving new software licenses until a survey of teachers was conducted to determine whether and how much they used technology.

In response to several Board members’ comments at an earlier Finance Committee meeting, Superintendent Paul Goren said he asked Andrea Mainelli, a consultant and member of the Financial Sustainability Committee for the Strategic Planning Process, to review how the District is using technology. He said the District is also in the process of developing a new three-year technology plan.

Debt Limits

Absent a referendum, the District’s authority to issue bonds to pay for capital projects is limited by its Debt Service Extension Base (DSEB), said Dr. Brown. After the $5 million in bonds just approved by the Board are issued, she said, the District will have authority to issue an additional $3 million in bonds under its DSEB and that an additional $2.5 million will become available in each future year.

The amount available is far less than the amount needed to fund the capital projects that the District has identified. For example, Dr. Brown said the District has identified roof and masonry work in the amount of $23.9 million, which is spread out over 18 years to keep capital costs down in any one year.

In addition, Dr. Brown said, there are $16 million in projects that were identified in the 10-year life safety survey conducted in 2005 that have not yet been completed. The next 10-year life safety survey is planned for the summer of 2016. It is likely that additional building work will be identified in that survey, she said.

Administrators have identified numerous other capital projects including site improvements, replacing ceilings and lighting in the schools, removing asbestos and replacing some floors, upgrading HVAC at certain schools, replacing classroom cabinets, adding cafeterias and creating safe entrances in certain schools. Much of this work is due to the age of the District’s buildings.

The District’s draft strategic plan presented to the Board on March 2 says, “The cost of the capital project backlog exceeds $100 million.”

In order to move forward with all these projects, the community would need to increase the District’s bonding authority in a referendum, said Dr. Brown.

At the Finance Committee meeting, Dr. Brown presented a schedule of projects that the District could afford to fund over the next eight years, while maintaining a reserve of approximately $2 million in the District’s DSEB for emergencies. Dr. Brown said the capital projects were prioritized and include only roofing and masonry work, replacement of some heating systems that administrators think will need to be replaced, and a relatively small amount for technology. Aside from funding existing technology leases, the eight-year plan assumes spending $400,000 for new technology equipment and $450,000 for software subscription and maintenance each year.

“We’ve got more things on our list than we can afford,” said Dr. Goren. “If we write a memo about things we wanted to do in the future, be it a STEM lab, be it an addition to a building, be it other needs, those are needs that the debt service can’t handle, and we have to seriously think about a referendum as one of the mechanisms to move forward.”