November 29, 2023
By: Dwayne Page
A meeting of the minds
For the first time in more than a year, members of the county commission and board of education met together Tuesday night in an informal workshop setting to work toward some funding arrangement for the eventual construction of a new 800 student Pre-K to 2nd grade elementary school to replace the existing Smithville Elementary School complex.
While both County Mayor Matt Adcock and Director of Schools Patrick Cripps said the joint meeting was cordial and productive, no agreement came out of the session. None could at this meeting since it was only a workshop.
“It was a productive conversation. I think we (county commission) answered a lot of questions, and we received a lot of answers to questions we had. We still haven’t worked things out. After talking with the school board, we have learned they apparently have more needs than we thought they had,” said County Mayor Adcock.
The existing Smithville Elementary School, originally built in 1958, now is 70,557 square feet in size, and had an enrollment in August of 550 students. As far back as 2017, a facilities study by Upland Design Group, concluded that the school, which had mold and other concerns, should be replaced and repurposed for other uses. In October 2022 the architects estimated the project cost to build a new Smithville Elementary School was $46,199,875 at that time.
If such a project is funded with a long-term bond commitment, the county might not be able to undertake another school building project for years to come. At the meeting Tuesday night, school officials pointed out that while the core building of Smithville Elementary is now 65 years old, the other four schools are aging as well. The high school is 60 years old and both the middle and west school are close to 50 years old. Northside Elementary has been in existence for almost 25 years.
As for this project, what the group learned from County Mayor Adcock and the county’s fiscal agent Steve Bates is that although a $40 million school project could be funded without a property tax increase or even a wheel tax using available local option sales tax funds and interest income on bond proceeds, the school board would need to be willing to contribute $2 million from its $10 million fund balance (reserves) to make the plan work. The county would also need a commitment from the cities and school board to extend the existing sales tax agreements between the parties which expire July 16, 2037. Under those agreements, the cities turn over to the county for schools a greater percentage of their local option sales tax collections than they would otherwise be required to do. That money goes into what is called the Local Purpose Tax Fund for Schools to help fund school operation and debt.
“The best-case scenario would be to extend the sales tax agreements between the county, cities, and school board (beyond 2037) in order to do 30-year bonds but do an emission of bonds to build the school and amortize it over a 15-year period with a $ 2 million contribution from the Board of Education from their fund balance together with a contribution from local purpose (local option sales tax fund). Under this plan, we (county) would take $5.6 million (from local purpose/sales tax fund) together with the school’s $2 million contribution and together with bond proceeds issue an amount of bonds to build the school. By amortizing it quickly over 15 years then it opens up future borrowing capacity for another school to be built once that issue is paid off,” said Bates.
The Board of Education is reluctant to make a $2 million commitment from the school district’s fund balance because of other needs including some that are state mandated which either are being or may have to be financially supported locally from the fund balance (reserves).
“We all understand a new school needs to be built but the tricky part is how are we going to fund it? We actually need three or four new schools, but we can’t get to the second school until we get the first one built,” said Director Cripps.
“We have concerns about them (county) asking us to contribute $2 million from our fund balance (reserves). Right now, we (school district) have close to $9.9 million in our reserves (fund balance) and that is healthy but when you run a budget of up to $29 million then $9 million is not a whole lot of money and to think that we could possibly be pulling $2 million out of that and suddenly be down to $7.9 million left in reserves is a cause of worry for me. We (school district and school board) have been good stewards of the money and because of that we have been able to give pay raises to our employees without having to ask the county commission for more local funding to do that and I would not want to harm that ability. I would like for us (school district) to be able to take care of our business with our money and not have to ask for more from the county,” said Director Cripps.
“There are also mandates we have to meet which are not funded by the state,” Cripps continued. “Right now, we are able to cover those (costs) with some of the grants we have been able to write because of COVID but those end this year so we will have to come up with additional money to fund those mandates and that comes at a cost to our local budget. So again, it concerns me having to go into our (school) reserves for anything and if we have to go deeper into our reserves to help pay for a new school that scares me even more. And really, although we certainly need new schools, if we don’t have quality teachers and quality support staff in our building working because we are not able to take care of them with their pay it really doesn’t matter what kind of building you have,” said Director Cripps.