Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, June 2, 1995 TAG: 9506020076
SECTION: CURRENT PAGE: NRV-2 EDITION: NEW RIVER VALLEY
SOURCE: MELISSA DeVAUGHN STAFF WRITER
DATELINE: CHRISTIANSBURG LENGTH: Medium
The Montgomery County School Board tried to enlist the support of the county Board of Supervisors for a major school-building agenda Wednesday, but the supervisors balked at endorsing the plan, which would cost county taxpayers at least $34 million.
"This was just dumped in our laps tonight," said Supervisor Joe Stewart of Elliston. "I don't see why we need to approve this now."
Instead, the supervisors put off voting on the plan until their June 12 meeting, after the members have had time to review the entire document. The School Board will wait to hear from the Board of Supervisors before it makes its next move.
The study, which the School Board approved in January, calls for four new schools in the next five years to alleviate overcrowded conditions. The four projects include a new elementary school in Riner, new middle schools in Christiansburg and Blacksburg, and a new high school in Shawsville, but are not prioritized in order of construction. Furthermore, student enrollment projections estimate steady growth by 1998, which would make crowding at existing schools worse.
The supervisors were most concerned about funding. The school system put a $34 million to $39 million price tag on the projects, but that's "really a shot in the dark," said school Finance Director Dan Morris. No engineering or architecture work has been done, nor has any land been purchased for the sites. Those figures, pointed out Supervisor Nick Rush, also don't count the interest on the projects.
Morris said money for the project could be financed through any combination of Virginia Public Service Authority loans, state Literary Fund loans or general obligation bonds.
If the latter is chosen, the total cost for building the schools would top $55 million, far too much for the county to handle, according to Carol Edmonds, the county's finance director. The Montgomery-Floyd regional library was funded through general obligation bonds.
But the school system doesn't think that would ever happen. Instead, it is hoping for a combination of Virginia Public Service Authority and Literary Fund loans, which are available at a lower interest rate, to pay for the projects. With this source of funding the cost would be closer to $48 million.
Key to Wednesday's discussion was the impact paying for school-building borrowing would have on the county tax rate. The county's financial experts tried to figure how much the real-estate tax rate - Montgomery's primary money-raiser - would have to increase to pay for debt service.
Under the most expensive scenario, the county would fund the entire package through general-obligation bonds. In that case, the tax rate would have to increase by a maximum of 19 cents over five years, generating $197,500 per penny, according to Edmonds' estimate. For the owner of a home assessed at $80,000, that would mean an annual tax bill change from $552 to $704, an increase of $152 or 27 percent. That doesn't take into account town tax rates or the reassessment conducted every four years.
Using a combination of loans would cause the tax rate to increase by a maximum of 14 cents over five years, according to Edmonds' projections. In that case, the homeowner would see a tax-bill increase of 20 percent.
The authority and Literary Fund loans do not require voter approval, but general obligation bonds do. Using the general obligation bonds is unlikely because there is little time to gather the information needed by September to put the issue on the November ballot.
The supervisors also questioned the School Board on its enrollment projections.
"In terms of the enrollment projections, they've been very accurate," said Superintendent Herman Bartlett "There's less than a 1 percent difference in what's been estimated and what we're seeing."
Based on those figures, the school system simply has to have more room, he said.
"Could you substantially reduce the cost if you went to a different design?" asked Supervisor Henry Jablonski. He also asked if vacant buildings could be used as temporary schools, instead of building all new schools right away.
The School Board did not have an answer to those questions.
After discussing the dollar side of the issue, the two boards went into a joint executive session to talk about possible sites. In an unusual move for the supervisors, three members - Joe Gorman, Ira Long and Jim Moore - voted against talking behind closed doors. The School Board voted unanimously for an executive session. No action was taken as a result of the 30-minute session.
Staff writer Brian Kelley contributed to this story.
by CNB