Upfront school costs vs. long-term savings debated


By Evan Goodenow - egoodenow@civitasmedia.com



<p style="text-align: right;">Photos by Evan Goodenow | Oberlin News-Tribune Oberlin Schools superintendent David Hall

Photos by Evan Goodenow | Oberlin News-Tribune Oberlin Schools superintendent David Hall


Oberlin Board of Education Barry Richard


Michael Burns, Baird & Co. public finance director


Scenarios for Oberlin’s proposed new school project are testing board of education members.

They’re trying to balance the high upfront costs to taxpayers of constructing a building for all grades, pre-kindergarten through 12th grade, versus millions in long-term savings.

Constructing one building, rather than phased construction of separate PK-5 and 6-12 schools, would save $3.2 million, board member Barry Richard said at a study session May 10.

Factoring in four percent annual inflation for four years — the time between finishing the first school and building the second — the savings are $6.8 million.

The savings are primarily because one building would be 6,000-square-feet less than two schools, said Richard who consulted with Ohio Facilities Construction Commission officials.

Richard said one-time construction makes fiscal sense, but whether voters will be sold on it is “the key question” for board members.

Board members, who began project planning in 2012, discussed six building options at the session. All included Leadership in Energy and Environmental Design silver and platinum ratings. LEED certification and standards are determined by the U.S. Green Building Council.

Buildings can receive silver, platinum, or gold certifications. Rating factors include energy performance, indoor environmental quality, use of sustainable buildings materials, and water efficiency. To receive state taxpayer funding — about 19 percent of the cost will be paid with state money if taxpayers approve it — schools must receive at least a LEED silver certification, board member Albert Borroni said.

The options discussed were:

• A $17.2 million LEED platinum PK-5 school paid for with a 37-year, 4.81-mill levy. It would cost the owner of a $100,000 home an additional $171 annually.

• A $15.2 million LEED silver PK-5 school paid for with a 37-year, 4.37-mill levy. It would cost the owner of a $100,000 home an additional $155 annually.

• A $29.8 million LEED platinum 6-12 school paid for with a 37-year, 4.81-mill levy. It would cost the owner of a $100,000 home an additional $171 annually and also require a 30-year, 0.50 percent income tax costing another $200 annually for a worker earning $40,000 per year.

• A $26.7 million LEED silver 6-12 school paid for with a 37-year, 4.81-mill levy. It would cost the owner of a $100,000 home an additional $171 annually as well as a 0.25 percent income tax for 30 years, which would cost another $100 each year for a worker earning $40,000 annually.

• A $41.7 million LEED platinum PK-12 school paid for with a 37-year, 4.81-mill levy plus a 0.75 percent income tax costing a worker earning $40,000 annually, $300 yearly.

• A $37 million LEED silver PK-12 school paid for with a 37-year, 4.81 mill levy plus a 0.75 percent income tax costing $300 per year for a worker earning $40,000 annually.

The last two options have the same income tax and millage rates despite one school costing $4.7 million more. That’s due to school boards only being allowed by the state legislature to seek income tax in quarter percent increments, said Michael Burns, public finance director for Baird & Co., who spoke at the meeting.

He said after the meeting that the board believed seeking a two-percent income tax hike would be excessive. Burns said the extra money generated from the income tax if the $37 million project were approved could be used to lower the millage rate for ongoing maintenance costs unrelated to the project.

“The goal of the school board is to keep the costs as low as possible (but) it’s a really sizeable project,” Burns said.

The project is being proposed due to growing maintenance costs for the district’s aging schools. Langston Middle School was built in 1923 while Eastwood and Prospect elementaries were built in 1955 and 1960 respectively. Oberlin High School was built in 1960.

Annual savings from replacing Eastwood and Prospect with one school would be $460,000, district treasurer Angela Dotson said. A PK-12 building would save $1 million annually through reduced electricity, maintenance, and personnel costs.

School officials and Burns emphasized the long-term savings from energy efficiency and low borrowing costs of the project.

However, resident Sandra Redd said she and many other taxpayers can’t afford the project in a district where 52 percent of of the district’s roughly 1,000 students live in poverty.

“I’m bleeding now trying to pay the taxes just for the schools and you want this kind of money?” asked Redd, who angrily left the meeting after commenting. “I just don’t understand where you guys think we can get this.”

Richard responded that board members are trying to be sensitive to taxpayers and have done extensive planning. He said saving $1 million by having one building rather than five schools is fiscally responsible.

“Our job, if we do make a decision to go forward, is to find out how to sell it,” Richard said. “(So) that people say, ‘Yeah, that’s a good idea. I understand it’s going to be more taxes, but in the long run, it’s going to be good for the community and for our kids.”

Board members are leaning toward building on 40 acres they own by Oberlin High School, 249 North Pleasant St. They are considering buying nine acres adjacent to the property owned by Oberlin College for $50,000, superintendent David Hall said.

However, some of the nine acres are believed to be on wetlands and can’t be built on. Hall said an environmental assessment in the next few weeks will be done to decide where to build if the project is approved.

A final vote on whether to propose a levy/income tax on the November ballot is scheduled for June 28. If the project is approved, board members hope the building would open in 2020.

Evan Goodenow can be reached at 440-775-1611 or @GoodenowNews on Twitter.

Photos by Evan Goodenow | Oberlin News-Tribune Oberlin Schools superintendent David Hall

http://aimmedianetwork.com/wp-content/uploads/sites/44/2016/05/web1_IMG_9451.jpg

Photos by Evan Goodenow | Oberlin News-Tribune Oberlin Schools superintendent David Hall

Oberlin Board of Education Barry Richard
http://aimmedianetwork.com/wp-content/uploads/sites/44/2016/05/web1_IMG_9455.jpgOberlin Board of Education Barry Richard

Michael Burns, Baird & Co. public finance director
http://aimmedianetwork.com/wp-content/uploads/sites/44/2016/05/web1_IMG_9462.jpgMichael Burns, Baird & Co. public finance director

By Evan Goodenow

egoodenow@civitasmedia.com