County Commissioner Austin Shaver presented a
tentative plan to fund the first phase of the county school building
program without raising taxes but some commissioners questioned his
Phase I of the building program includes four
projects: a new K-12 school in Greenback; combining Loudon
Elementary and Fort Loudoun Middle School into one facility,
modifications and expansion of the cafeteria at Philadelphia
Elementary and a new middle school in Loudon.
Shaver introduced the idea of giving the county
school board a set figure and telling them to tailor their building
plans accordingly. He said it would be better to just to tell the
board, "this is how much we can build without new taxes." Shaver
said it was the same tactic the county commission used this year
when determining how much of the school system's proposed budget the
county would finance then letting the board trim their budget to fit
that number. Shaver distributed a fact sheet outlining several
options for borrowing money to get the program up and running.
His plan is to pay for the program from the Education
Debt Service Fund - Fund 156 - without impacting the county's
reserves or rasing property taxes. His calculations included
borrowing amounts from $41 million for 30 years at 3 percent
interest to $32.4 million for 30 years at 5 percent interest.
The handout included the rational behind borrowing on a 20-year loan
verses a 30-year loan. Shaver said the 30-year loan did not include
pre-payment penalties which would allow the county to pay the loan
off early when the economy is good or allow the county to pay less
during the lean years. Shaver said giving the school board a bottom
line number amounts to "doing our job" and "tells the school board
'here's what you have.'"
Commissioner Don Miller said he had also come up with a similar plan
to fund the building program but he would prefer waiting for the
school board to get actual bids on the building projects so there
will be a better idea of actual costs. As to 30 verses 20-year
loans, Miller said that could be decided in the future. "We don't
need to decide on this until they get the bids," he said.
Shaver said the advantage of giving the school board hard numbers is
it would "force the school board to conduct themselves like real
people" meaning "they can't spend what they don't have."
Whatever finance plan is decided on, Commissioner Bob Franke said it
is "critical to keep this ball rolling." Franke represents Greenback
on the commission and Phase I of the building program includes a new
kindergarten through grade 12 school in Greenback to replace the
worn out building currently in use.
Commissioner David Meers asked Assistant Director of Loudon County
Schools Jason Vance, who was in the audience, what would be done
with the old Greenback School if a new one is built. Vance said that
was "yet to be determined."
Miller said the disposition of the old Greenback School would be up
to the school board, but they would be well advised not to come back
to the county for more money to tear down the old school or for
anything else. After funding a building program, "the county is
really going to be stretched," Miller said. He added the commission
might have to "bite the bullet" in the next two years and raise
property taxes to fund the building program.
School board member Van Shaver was in the audience and spoke up
saying he felt it would be a waste of money to pay for building
proposals and get bids on projects that might never come to fruition
due to finances.
He said the board currently has thousands of dollars worth of plans
for defunct projects and estimated it would cost approximately $1.5
million to get all four projects to bid.
Miller said he would prefer the school board come to the commission
for funds to get the projects to bid and then the commission would
have a better idea of how much money would have to be
raised. "You've got to come to us to request it," Miller told Van
Commissioner Earlena Maples said the upcoming
election might see new people on the school board who might have
different ideas about the building program and how to finance
it. "The election could change everything," she said.
Commission Chairman Roy Bledsoe expressed concern the school board
would sign a contact with a construction manager, who are
traditionally paid a percentage of the over all contract costs to
oversee construction projects.
Vance said the board was consulting with attorney Chuck Cagle about
the contract with Merit Construction and how much the firm would be
paid to manage the projects. Vance said Merit had offered to lower
their fees to manage the projects.