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GF schools could build new theaters -- without raising taxes

Grand Forks Public Schools could soon start major high school theater arts and music construction projects and substantially upgrade Cushman Field, all without raising property taxes.

Grand Forks Public Schools could soon start major high school theater arts and music construction projects and substantially upgrade Cushman Field, all without raising property taxes.

That's what Bill Hutchison, district business manager, told the School Board's facilities committee Tuesday when members discussed their options to start $14.7 million in projects after a consulting team this fall recommended big upgrades to the high schools' existing theater arts and music spaces.

Hutchison was asked to come up with funding options to expand Central High School's auditorium for about $2.5 million, build an $8.1 million, 750-seat theater at Red River High School and also build a $2.4 million Central addition to house drama and music space.

No new taxes?

His figures show all three projects could be started as early as 2010 or 2011 and be paid with current revenue sources. The district could also take on $215,000 in acoustic upgrades at existing music rooms in Central.

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Also possible would be a $1.5 million renovation of Cushman Field, including underground work and a new track surface. Installing artificial turf would allow the field to be used for games and practices, important if a new Red River theater took over some existing practice fields.

That work could be paid with a special assessment fund, leaving $13.2 million needed for the four theater arts and music projects. Because the school district has a total debt of $3.5 million, paying bonds for the projects could be accomplished without looking at tax increases.

"That's pretty low for a school district this size," Hutchison told the Herald about the total debt. "We're very fortunate. So, it gives the board the option to do some of these things."

The debt requires about $460,000 in annual payments and is scheduled to be paid off in 2018.

After 2011, those payments are the only scheduled expenses from the district's building fund, a special tax levy.

North Dakota school districts can levy up to 20 mills for a building fund, used for maintenance and new construction. Grand Forks has a building fund levy of 11.23 mills, which will take in about $1.675 million of revenue in the current school year.

With only relatively minor building upgrades and maintenance needed in the next few years, much of the fund would be available to dedicate to the theater arts projects.

Hutchison's calculations show annual $900,000 repayments for the 20-year bond could be made from the fund while still keeping money for future projects.

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Options

The district can apply for Qualified School Construction Bonds, federal money given to the states to allot to projects, which would lock in a low 1.5 percent interest rate and keep costs to a minimum during the bond repayment.

Under Hutchison's "realistic case scenario," Grand Forks could apply for $3 million of these bonds, requiring $175,000 in annual payments. If the remaining $10.2 million was paid with Building America Bonds, which use federal stimulus dollars to lower the interest rate, the total annual cost for the projects would be $890,000.

The worst-case scenario, which would require getting regular bonds for the bulk of funding, would raise the annual payments to $940,000.

District administrators recommended proceeding with the projects, timing them to coincide with repayment of Lake Agassiz Elementary School renovations. That debt will be repaid by the next school year.

But not all project details are finalized. An organizational study, to be completed next April, could affect Central's possible new addition -- some committee members would like to see a new wrestling room or gym space added rather than theater space.

An art lab will also need to be moved once the Central auditorium expansion starts.

Red River's new theater has two potential locations, and a final location needs to be picked before construction could begin.

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Next steps

But some projects could be started as early as next year, depending on what the board ultimately approves. Hutchison's information will be discussed at Monday's School Board meeting, and the board could vote as soon as January to take action.

A public forum in January could also get public input on the projects before a final decision is reached. But Hutchison told the Herald that his figures show the district could go ahead with all projects and still be fiscally sound for the future.

"The reason I put it together this way is to try to show them that we really are in a pretty good position, and they have options to do some of these things," he said. "Again, it depends on what the board thinks and what the public opinion is."

Hutchison said the district's 2009 total mill levy of 139.35 is pretty low -- out of the state's 15 largest districts, Grand Forks ranks ninth in its levy.

"If we can do that and not raise taxes, I think it's a good deal," he said.

Johnson covers local K-12 education. Reach him at (701) 780-1105; (800) 477-6572, ext. 105; or send e-mail to rjohn-son@gfherald.com .

Related Topics: CENTRAL HIGH SCHOOLGRAND FORKS SCHOOL BOARDEDUCATION
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