Needs $31.7 million more to cover costs
Madera’s new High School has been named, the site has been purchased, and the groundbreaking has taken place. All that remains now is to figure out how the district will pay for it.
The total cost of the project is $210.6 million, according to Deputy Superintendent Sandon Schwartz, but potential funding sources have thus far yielded only $178.9 million, leaving the district searching for another $31.7 million.
The facts and figures relative to building Matilda Torres High School were presented to the school board at its meeting on April 24, and trustees were told then they might have to borrow money to pay for the project.
Schwartz and Director of Facilities Planning Rosalind Cox outlined the potential funding sources, which included the following:
• $70 million from the 2014 school bond.
• $6.5 million from developers’ fees.
•$30 million now on hand in Building Fund 41.
• $20 million from Building Fund 41 in 2018/19 and 2019/20.
• $1.6 million from construction funds left over from Virginia Lee Rose School.
• $11.8 million from state matching funds owed to MUSD for past construction.
• $39 million from state matching funds for Matilda Torres High School.
After detailing the possible funding sources, Schwartz and Cox then explored three options for dealing with the $31.7 deficit.
Borrowing money via Certificates of Participation (COP) was the first option presented. The board heard three scenarios in which this could be accomplished.
Assuming that state matching funds would be received by 2021 and that the district continued to annually set aside $10 million in building fund 41, the district could borrow $69 million in 2018 for three years. The principal and interest of $74.4 million could be paid in one lump sum in 2021.
In COP scenario two, the district would borrow $69 million in 2018 under an arrangement in which it could choose to repay a portion of the debt (using $39 million from the state and $22 million from the building fund) and the remainder in annual payments of $900,000 until 2048.
COP scenario three involves borrowing $69 million in 2018 for 30 years. The district would begin repayment of the debt in 2021 in annual installments of $4.8 million and continue through 2048. The total of payments would be $136 million.
In addition to borrowing money, Schwartz and Cox presented two additional methods of dealing with the deficit. They suggested the board could narrow the scope of the project, Money could be saved by eliminating the Aquatics Complex (saving $9 million), doing away with the Culinary Arts Building (saving $3 million), and eliminating 15 classrooms and the parking lot near the Aquatics Complex (saving $9 million).
This suggestion raised scowls of discontent on the faces of some trustees.
Finally, the board was given one more cost-saving option. It was told some of the glitz of the campus (value engineering items) could be eliminated. It was estimated that $5 million could be saved by choosing an alternative finish to the swimming pool, altering the landscaping, reducing site concrete, tightening up on building materials, and discarding plans for a shade canopy outside the cafeteria.
A good portion of the deficit in construction funding for the new high school can be laid to the increase in materials and labor costs, which have skyrocketed since the project began, board members were told.