By Brent Wilson, Field Officer
At the July 11th Greene County Board of Supervisors meeting, three residents spoke in favor of the proposed school facility study. The third speaker used the military term, FUBAR, to describe the current traffic patterns at the Stanardsville campus.
As background, School Board President Leah Paladino outlined the 31 month process to date. A committee was selected to oversee the process and the company VMDO https://www.vmdo.com/ from Charlottesville has been contracted by the School Board to study and make recommendations for the project.
Paladino indicated that VMDO prioritized the project with 1) safety / security, 2) increase capacity for the 7th fastest growing county in Virginia, 3) adaptability and 4) space for the community to use.
Paladino then introduced Bryce Powell from VMDO to go over the detail of the project. The plan concept is to tie the school project in with the Main Street project and reduce traffic conflicts on the school campus. The plan is iterative with each step in the project builds toward the next phase.
Per Powell, the total presentation is a forward look 15-20 years into the future with the “dark blue” section being the first phase that is being discussed tonight. The emphasis is on safer cross walks, improved outdoor dining, having all the buses go to the back of the high school for drop off and pick up of students and the front to be used for parent dropping off students. The pedestrian crossings may have a raised, colored surface to highlight these areas to drivers to ensure safety.
As the Greene County is the 7th fastest growing county in the state, the plan is to expand the high school and the middle school to be able to hold an additional 200 students each – more than the current demand. At the high school the dining room congestion is a primary focus. The middle school also needs the kitchen and cafeteria enlarged. The space to enlarge the middle school will come from pushing Monroe Drive farther away from the school to allow for an expansion at the front of the building.
Powell discussed the cost of the project vs. what had been projected last fall. While the plan has become more focused in the past 8 months, construction costs have risen significantly this spring – 15-20%. He attributed this to contractors from Charlottesville to Harrisonburg having a large volume of work that enables them to raise prices in addition to a skilled labor shortage that drives up their costs. The Free Enterprise Forum has seen this trend in many municipal projects in recent months.
Chairperson Michelle Flynn (Ruckersville) asked Powell what he expects will happen to operating costs. Powell indicated with upgrades to the HVAC systems and improved lighting he expected the energy costs to decline. In addition, he indicated that there are relatively small increases in square footage (approximately 3,000 square feet at the high school and middle school each) and it was mainly a reconfiguration of the existing footprint.
Supervisor Jim Frydl (Midway) asked Powell how firm the costs were. Powell indicated that they were at the high end. For example, the increased space for 200 students at both the high school and middle school might only require seating for 320 to start. It wouldn’t be the maximum day one as the plan has room for growth.
Supervisor Bill Martin (Stanardsville) stated the presentation while detailed was excellent. It was well thought out and presented well.
Perhaps in a measure of full transparency, the School Board prepared an amortization schedule for the project. The project must be sent out to bid before the Board of Supervisors approves the final expenditure (and determines the financing mechanisms).
The financial pages of the presentation were addressed by Kristie Spencer, Greene County Schools Director of Business and Facilities.
The first page she presented was the retiring of current schools debt, by year and cumulatively. The reductions started at $230k going into 2018. The next three years show the largest reductions 2018 = $103K, 2019 = $183K and 2020 = $312K so that the cumulative amount by 2020 grows to $828K. The next seven years range from increases of $12K to $57K and then spike back up to $298K in 2028 and $463K in 2029. By 2029 the cumulative amount of retired debt reaches $1,765K.
As a reminder to the supervisors, Spencer stated the current unspent Capital Fund Balance which has accumulated to a balance of $2,815,000.As the supervisors had not decided to use these accrued funds, Spencer did not show using these funds to pay for the project even though these funds could pay for the first two and one half years.
The next two pages showed four scenarios, two with 25 year loans one at 3% and another at 3.5%. The other two scenarios used 30 year financing with 3% and 3.5%. The gross annual cost with the 25 year and 3% scenario is $1,630,000.
However, each year as more existing debt is paid off (see two paragraphs above) thus reducing the net payment for the project to where in 2029 there is actually a reduction below the current level of debt service.
|Year||Net Increase in Thousands||Tax Rate Impact||Less Capital Fund Balance in Thousands|
Average Tax Rate Impact = $.02/Year
Average Tax Rate Impact less Capital Fund Balance = $.01/Year
The current projected cost of the project of $28 million would cost nearly $41 million ($1.63 million x 25 years) with interest at 3% over 25 years, the net additional cost accumulated over 25 years would equal approximately $7 million in total above current levels. Plus the accumulated Capital Fund Balance of $2.814 million represents excess tax revenue that taxpayers have paid in previous years.
While there are many infrastructure demands on the Capital Fund Balance, we ask that Supervisors consider using this dedicated fund prior to increasing the tax rate.
Brent Wilson is the Greene County Field Officer for the Free Enterprise Forum a privately funded public policy organization. The Free Enterprise Forum Field Officer program is funded by a generous grant from the Charlottesville Area Association of REALTORS® (CAAR) and by readers like you. To support this important work please donate online at www.freeenterpriseforum.org