When a school corporation takes on a project exceeding $1 million, a public hearing called a 1028 must be held.
Monday at noon, Warsaw Community School Corp. Board of School Trustees held a 1028 hearing for a renovation project at Harrison Elementary School.
Funds for the work will come from Qualified School Construction Bonds through the American Recovery & Reinvestment Act.
Board attorney Max Reed said he was hoping to have members of the public at the meeting to talk to them, too, about the project and financing. No patrons appeared.
Reed said there are some problems that need addressed at Harrison, Lincoln, Washington elementary schools and Lakeview Middle School. Funding from the QSCB will take care of the problems. Because the total cost of the renovations will exceed $1 million, Reed said that triggers the need for the 1028 hearing.
Notice of the public hearing was published in the Times-Union, Reed said.
The purpose of the meeting is two-fold: to make the public aware of the project the school corporation has in mind, and to provide a chance for the public to ask questions.
Chief Financial Officer Kevin Scott said the application for the QSCB happened in late spring when the new schools were not open yet. Warsaw Schools applied for and got QSCB funding for roofing work at Eisenhower Elementary last year.
Harrison was built in 1991. Compared to modern standards, Scott said, it's not as energy efficient as it could be. One of the big items Warsaw wants to replace with this round of QSCB is Harrison's roofing. Sections of the roofing are 20 years old and are showing signs of wear and failure.
Besides the roofing, this round of QSCB will be used to make the HVAC system more efficient, upgrade the boiler and make lighting more efficient at Harrison, Lincoln, Washington and Lakeview. Total cost is estimated to be $1,995,000, including $39,900 for bond issuance costs.
Curt W. Pletcher, certified public accountant and partner with H.J. Umbaugh & Associates, Plymouth, said the nearly $2 million in QSCB this year will be paid over a course of 11 years. The federal government will subsidize the interest, which will range from 1.2 percent in 2011 to 5 percent in 2022.
As scheduled now, Warsaw Schools will make a first payment of $570,000 in 2011. After that, payments will average about $145,000 per year.
Pletcher said the project is not estimated to add any additional tax rate beyond what's being paid in 2010. If the school board did not approve the QSCB, the tax rate would decrease by 2 cents per $100 assessed valuation in 2012.
Dan Robinson, school board vice president, asked Pletcher, "What happens if Congress decides not to do this anymore?"
"I'll not say never, but it's a remote possibility," Pletcher responded.
But if it does happen, Robinson asked, what would the tax impact be to the school system?
Pletcher said the bonds could be redeemed and the school corporation could reissue them. If it happened, it would add some additional tax impact.
Board member Kent Adams said this was a case where you hate to incur more debt, but with what is offered and what is needed for roofing renovation at Harrison, it's fortunate the school corporation can address the need with the bonds.
Robinson asked Scott if the prices for the work don't come in where expected, what part would be eliminated first. Scott said it would have to be a collective decision with the board, but, "I think we want to get the full envelope at Harrison."
Board President Deb Wiggins asked, "The repairs, maintenance looks good to carry us through 2011 with no major needs?"
"If we are able to do all the project, correct," said Greg Schroeder, director of maintenance.
Wiggins asked if he knew of any major items at this time that will need to be addressed. Schroeder said there are some serious needs at Lincoln and Washington schools, but they still need to determine the way to approach that.
"But we're looking at 2012?" Wiggins asked, to which Schroeder affirmed.
Before adjourning the public hearing, the school board approved a project resolution, a preliminary bond resolution and a declaration of official intent to reimburse expenditures.
