BOE: How much money is enough?

Published 12:28 am Tuesday, April 18, 2017

Members wrestle with funding options
for proposed $8M in AHS improvements

Members of the Andalusia Board of Education on Monday asked for more information before taking action the superintendent’s recommendation that they ask the Andalusia City Council to secure a bond for proposed construction projects.

For months, the board of education, the city council, and the council’s specially-appointed Public Building Authority (PBA) have been discussing renovations of the Andalusia High School auditorium and stadium.

Members of the PBA have been soliciting private contributions for the project, and there is $1 million in education sales tax proceeds that have been set aside for the project, giving the board approximately $1.75 million on hand with which to start the projects, for which are expected to cost approximately $8 million as currently designed.

Superintendent Ted Watson recommended board members ask the council to seek financing with the following conditions:

  • The bond would be secured for an amount of no less than $4 million and no more than $6 million.
  • The bond would be the liability of the City of Andalusia, to be paid using the half-cent sales tax revenue collected by the city for the school system.
  • The payment of the bond would be made over the duration of no less than 15 years and no more than 30 years.

When pushed for additional information, Watson said the price tag for the project has not yet been determined.

“We won’t know anything in solid terms until we bid everything out,” Watsons aid. “The architects are projecting a range for $8 million to $8.5 million.”

Watson said early estimates are the auditorium project will cost $3.5 to $3.8 million. The project includes demolition of the current stage area, expanding that end of the building, new seats, acoustical improvements and a new sound system, as well as new restroom facilities that would serve both the auditorium and the gymnasium.

The stadium project, which is estimated at $4.2 million, can be done in phases, Watson said, adding that a possible solution would be to begin the auditorium project, and rebuild the press box and home bleachers of the stadium, then reassess the financial situation.

One of the board’s concerns is that demolition in the auditorium means the facility won’t be available for homecoming, and the facility possibly wouldn’t be completed before graduation in 2018.

“There are a lot of moving parts here,” Watson said. “But the city has to get moving on the bonds, which are a 90-day process, if we want to get started with construction in July.

Watson said there also is the possibility of securing a bridge loan at the end of the project if the bond financing doesn’t cover the project.

Board chairman David McCalman expressed a number of concerns.

“This is a quagmire of moving parts, and one of the moving parts is the price, which is very unsettled,” he said.

Estimates have varied, he said, based on whether planners were dreaming big, or thinking about a budget.

“Are we just going to get an amount we can feel comfortable paying back and do what we can do, or are we going to try to do most of this project?

“A number of people are in a hurry,” he said. “I’m not in a hurry. I’d rather do it right than be in a hurry.”

A sales tax passed in in 2013 generates more than $1 million per year that is earmarked for the school system. However, the council controls the proceeds, and has final approval over how those funds are spent.

This year, for instance, the funds were used to upgrade computers; replace windows at Andalusia High School; and other projects. Watson said he plans to ask the council for fund a full music program at AHS next year, an item that was cut after the economy collapsed in 2008 and school budgets were prorated.

McCalman asked that board members be provided estimated amortization schedules and payments for different financing options, which they would review before making the request for funding. The board agreed, and will call a special meeting to review those numbers and make a request for fnding.

Board member Amy Dugger also expressed concerns that if the council opted to finance only $4 million, the projects as currently presented could not be completed.

“If it doesn’t get done, it’s going to be us that didn’t finish the project because we’re the ones putting the accelerator to the gas,” she said. “And I don’t want to do that.”

Watson said it also has been suggested that the board tap into its reserve fund for a portion of the financing. The state requires schools systems to have a minimum of one month’s operating expenses in reserve, and recommends having a three-month reserve. At present, the Andalusia system has approximately five months’ expenses in reserve.