The loan would pay for a new elementary and middle school campus. Board members say the money and the sales tax are needed to avoid crowding; low interest rates make it a good decision.
By JEFFREY S. SOLOCHEK
Published October 23, 2003
BROOKSVILLE - The Hernando County School Board has decided to borrow $30-million to pay for a new 1,400-student elementary and middle school campus.
The amount is about 30 percent higher than the loan the board agreed to seek just last month for the school, which would be built on Elgin Boulevard near Barclay Avenue.
The main reason for the steep increase, officials said, is that the school has been designed for more students than originally planned.
The $30-million loan amount does not include the interest payments, which were not calculated for the board, but were estimated to be more than $17-million.
The total would be tacked onto the district's existing debt load, which was $95.1-million as of June 30. Hernando County ranks 10th among Florida school districts in terms of debt per capita, finance director Carol MacLeod has said.
Most of the current debt comes from the 1980s, when the district took out loans to build new schools to cope with crowding at that time. In 1998, many of the current board members deplored the heavy borrowing while pushing for a local sales tax for new schools. They said they did not want to mortgage children's future.
"This is a big move. People are uncomfortable with borrowing a large amount of money," board member Jim Malcolm said during the board's meeting Tuesday night. "But I'm hoping people will see the need for this."
Board members have said that money is needed now to begin building the kindergarten through eighth-grade campus; voters, meanwhile, will not be asked until March whether to renew a half-cent sales tax to pay for school construction.
Malcolm noted that the district's enrollment has surged beyond all expectations this year, and that most campuses already are crowded beyond their capacity. It appears that growth is likely to skyrocket in coming years as it did during the 1980s, he said.
"This is a tiny little step toward alleviating some of those problems," Malcolm said.
Board member Gail David opposed the borrowing, and suggested during workshop conversations Tuesday afternoon that the board should scale back its design requirements for the new school, which is scheduled to open in August 2005.
She said a $32-million school with interest attached would eat up too much of the money the district expects to have available for construction over the next decade - a projected $120-million, including the half-cent sales tax, which voters would have to approve.
A school with all the bells and whistles "isn't necessarily what we need right now as far as our goal of housing "X' number of students," David said Wednesday. "We're not going to be able to do it with schools like that, because we're not going to be able to afford the schools we need."
Though she raised questions during the afternoon workshop, she said nothing during formal board deliberations Tuesday night. David explained that the vote to approve the borrowing seemed settled, with Malcolm, Robert Wiggins and John Druzbick having stated their support, and she did not want to rock the boat.
"I don't want to jeopardize the sales tax," David said. "We desperately need that sales tax money."
Board Vice Chairwoman Sandra Nicholson agreed that the sales tax is critical to paying for future schools. She said Wednesday that she voted against the borrowing specifically to avoid giving tax critics ammunition.
"We shouldn't be borrowing when we're going to be asking for a tax referendum," Nicholson said. "I think we should, as painful as it is, especially with all these new students we didn't expect, we should bite the bullet for a year."
At the same time, she stressed that the public needs to understand that the board is in a tough spot.
"We have to put students somewhere, and it's kind of like throwing good money after bad by putting portables out there," she said. "There is no simple solution to all of this. We're going to have to do something."
During the board's debate, Wiggins also pointed to the sales tax as the preferred way to pay for construction. But he argued that $120-million generated over 10 years by a sales tax and other sources would pay for maybe four new schools. District analysts have projected the need for at least six new schools over that period.
"At some point, we would have to borrow money," Wiggins said. "Interest rates are probably at the lowest they've been in 30, 40 years. It does make sense to go ahead and borrow the money (now)."
Going into debt is not desirable, he said. But few people buy homes with cash, he noted, and the district obtaining a loan to build schools is essentially the same concept.
"I hope this doesn't set back the half-cent sales tax. I do think this is a wise use of money," Wiggins said. "It's a much-needed school."
School Board Vice Chairwoman Sandra Nicholson agreed that the sales tax is critical to paying for future schools. She said Wednesday that she voted against the borrowing specifically to avoid giving tax critics ammunition.
Board members have agreed in principle to ask voters on March 9 to renew a half-cent sales tax for construction. They decided Tuesday to dedicate the income, if approved, to new schools only, and not to use it for new wings on existing buildings or for the repayment of construction-related loans.
They postponed a vote on the official ballot language in order to give their lawyer time to work on the wording.
A current school district sales tax expires Dec. 31. Its proceeds covered a portion of the cost of Nature Coast Technical High School, which opened in August.
- Jeffrey S. Solochek can be reached at 754-6115. Send e-mail to solochek@sptimes.com
