Trending
BELLEFONTE -- An item was added for discussion to this week's Bellefonte Area School District Board of Directors' meeting regarding a potential Health Services building opening at CPI in the coming years.
Superintendent Tammie Burnaford and Kenneth Bean, Director of Fiscal Affairs and Transportation for BASD, spoke up during the meeting to generate discussion about the potential project.
"Many, many years ago, CPI added a transportation center and moved the heavy equipment programs down there. Somewhere along the line, before my time, I'm not sure when the discussion all started... there was a proposal to create a health sciences building that would house more of the adult-ed programs; RN program, OT/PT, medical transcript, probably a half-dozen or more programs that they would put in this health sciences building," said Burnaford.
According to Burnaford, before she was in the position as superintendent there were many discussions about building the health sciences building. She mentioned there were a good amount of grants that would help to pay for the building as well as a USDA loan totalling $7.7 million.
"They actually contracted with an architect and have some general plans of what that would look like. All of those grants and all of that loan are coming, we have to spend it, we have to do it. We have to decide whether we're going to move forward with the project or we're not," said Burnaford.
Bean and Burnaford had met on Tuesday morning to talk about the details.
"The biggest problem is, for the $7.7 million USDA loan, we have to have the building completely finished before we can get the loan. The districts have to do the financing up until they start getting these loans and grants in. That presents a lot of complications and problems," said Burnaford.
Because Burnaford was not a part of the prior discussions, she is unsure of how they've gotten to this point, noting that she is unable to answer questions regarding those past discussions.
"This is just a discussion tonight. I told the other superintendents -- all three districts have to agree, all three districts would have to front the money to get this off the ground -- I would bring it up tonight," said Burnaford.
After this brief description of the backstory, Bean took over discussing the financial impacts of the project.
"The USDA loan is a 2.25 percent rate. A very good rate. If this project isn't completed by September 2025 we can still get that loan, but the interest rate will reset to then-current rates. I seriously doubt they will be 2.25 percent," said Bean.
"I have doubts, too, because nothing has gone to bid. It has to be completed by 2025 including punch lists and everything else. You're talking about probably 18 months to build, I'm cautious about that," said Burnaford.
According to Bean some of the smaller grants available will be received upfront, but there is roughly $17.7 million in total grants and loans.
"The last numbers they saw in 2020 were $13.6 million. The project is obviously going to cost more than $13.6 million," said Bean. "At least four phone calls have gone to the architect that was already hired, they've spent over $800,000 to this architect. In total, $1.5 million has gone out the door at CPI for this project."
Burnaford noted that of that $1.5 million, the foundation has paid for some of it and Bellefonte has paid for some of it.
"The kicker is there's about $1.9 to $2 million (between all three districts) that the school districts will have to fund until the project is completed and the loan money is back. It equates to about $600,000-650,000 a year total, our portion is give or take 45 percent," said Bean.
Though the building would be housing adult education, the division of the money is based on how many secondary education kids are enrolled in CPI. Bellefonte has around 47 percent of the secondary enrollment at CPI.
With the potential building meant for only adult education, it would not affect current students enrolled in CPI.
"Roughly, in fiscal year 2024, the second half, we would owe money. Then 2025, 2026 and 2027 we would owe money. We are building a new elementary school. I have serious concerns if we have to add over $300,000 to our budget. Can we do it? Yes. The problem is it's either going to increase taxes more than they currently would be, take away from something we want to do or a combination of both," said Bean.
The loan, according to Bean, would increase the total cost at CPI. The plan, in theory, is that revenues from the health science building should generate enough to pay the debt.
At this time, the board does not seem convinced that this new building is in the budget.
Members were full of questions about what this project would mean for the district's budget, and the impacts this would have on taxpayers.
"Hypothetically, for district B, if they're already at the max and they're going to have to raise taxes, how are they going to do that? If they've already used their exceptions, how can they do that," asked Board President Jon Guizar.
"From what I understand there's some cash availability there. I could be totally wrong about that," said Bean.
"If I remember right, the last presentation we had on this (years ago) was that we weren't involved for any money unless they defaulted and then it would come back to us. We were pretty nervous about that but agreed that they could at least continue for now," said Guizar.
"The project can continue. It can get delayed. We would lose 2.25 percent. Project gets stopped, CPI and (all three school districts) in total are out $1.5 million. If this board says this isn't good for us, we're not interested, I would assume it stops. We're the overwhelming, almost half, of the total," said Bean.
There was a lot of discussion about options, potential risks and what gains there might be for the school if they were to follow through with funding the new building.
"There are two full-sized buildings at CPI that are not being used. One is being used to store equipment and the other is being used to store furniture. They're good sized spaces that could be renovated to do some of these things, too. That's my feeling and that was my opinion," said Burnaford.
Multiple members of the board also offered comments regarding the potential building.
"Our responsibility is to our students. Yes, it's awesome that this supports the community, but we have our students to worry about," said board member Donna Smith
"We know there are labor issues in this area, so getting people trained is great for the area, but I don't know if it should be the school district. Maybe there are other funding sources," said board member Julie Fitzgerald.
"We're a K-12 institution. I have a hard enough time being on the hook if their projections don't come through and we're on the hook for money that we weren't expecting. I really have a hard time when we're on the hook no matter what," said Guizar.
If CPI were to go through with this idea, but the building wasn't fully constructed by the deadline, the district and others involved would lose that 2.25 percent rate regardless.
To the board, the idea seemed like a lot of risk for not a lot of immediate reward.
"I think we all agree. (We) love the idea, I think we have a need. I don't think -- even if they did something for our students -- we have enough that would go there to justify the $300,000 a year, let alone potentially more money down the road," said Bean.
The Bellefonte School Board will meet again on Sept. 19 at 7 p.m. at the Bellefonte Middle School.