Park Rapids School Board eyes tax impact of pared-down bond
Debate swirls around the priorities for high school deferred maintenance and whether it's time to build a bus garage on school property.
The Park Rapids School Board dug deeper into the cost and tax impact of moving forward with a smaller package of school facility improvements on Monday night.
The workshop took place at a special meeting in the high school media center.
Consultant Jason Splett with ICS presented some tax impact estimates provided by Ehlers financial advisors for parts of the project discussed at the school board’s June 7 meeting. These included board-approved actions that can be taken without a bonding referendum.
Splett said the estimated budget totals $42.4 million for the priorities the board identified on June 7, including “Option A” for safety and security improvements at Century School – with school offices moved alongside the public entrances at both the east and west ends of the building.
With “Option B,” securing both entrances by buzzing visitors in from the current school offices deeper inside the building, it would cost about $38.8 million, he said. Both options include moving the high school office forward to secure building’s the main entrance.
Splett also noted that a lease levy could fund about $2.7 million to add space for art or agriculture programs and the Alternative Learning Center at the north end of the high school.
Board members discussed the pros and cons of the two security options for Century School and the “domino effect” of rearranging the high school. Board chair Sherry Safratowich voiced a preference for “Option A,” saying, “Do it right.”
Board member Stephanie Carlson questioned whether a second pick-up and drop-off lane on the west side of Century School will really enhance safety. She voiced doubt that parents whose kids go to both sides of the building will make separate drop-offs at both entrances.
Superintendent Lance Bagstad cited results of a survey about the past year’s pick-up and drop-off system. He said parents preferred previous years’ traffic flow.
Board member Dennis Dodge questioned whether the additional security of “Option A” is worth $3 million. Safratowich replied, “If there was ever an event, I want to be as safe and secure as possible. It’s like buying insurance.”
Board member Dana Kocka agreed, “If anything could happen, I would be kicking myself. $3 million sounds like a lot of money, but if something happens … ”
Carlson said anybody could be buzzed in from the office yards away, then go anywhere in the school. She said she has visited a lot of newer schools with a secured entrance where visitors check in at a window.
Splett agreed that most designs for new school construction have that kind of entrance.
Matthew Hammer with Ehlers said the estimated tax impact of the proposal with security “Option A” would be about $78 per year, or a little more than $6 per month. For “Option B,” the tax impact would come to about $70 per year, a little more than $5 per month.
By comparison, he said, the bond voted down in November 2020 and again in April would have raised the average resident’s annual property taxes by about $116.
Safratowich said that given the small difference in tax impact between the two options, choosing “Option A” makes sense.
Splett said they also looked at pulling $1.8 million worth of parking lot improvements out of the bonding project and using abatement money instead. Hammer said that because of the debt service structure required for abatement bonds, this would actually increase the tax impact.
“It really makes no sense to take that amount out,” he said, adding that the same issue applies to lease levy bonds.
Safratowich summarized the bottom line: “If you as the voter approve it, you’re going to pay less money than if we as a board decide to do it.”
Bus garage question
Safratowich said after this project, she does not foresee the board asking voters in the near future to spend more money building a new bus garage on school property.
She asked the board whether they are comfortable continuing to rent garage space at the fairground, which is already undersized for the district’s needs, or if this is a good time to finance a new bus garage as well. She said it will likely be another 20-25 years before the school board can ask its voters for that kind of money again.
Kocka said he has heard voters voice opposition to building a bus garage, and if it is attached to another bonding question, “I just worry that it’s going to make this fail.”
Dodge argued that having the bus garage closer to the school enhances safety by making it easier to evacuate students in an emergency.
Splett said adding the bus garage would cost about $3.8 million, putting the total project above $46.2 million.
Dodge said this still keeps the desired bond below $50 million, and this shows the school board is trying to reduce its request – previously almost $60 million.
Splett stressed that the board will still have an opportunity to reconsider before making a final decision about including the bus garage. He noted that in November 2020, the bus garage was a separate ballot question that failed by a wider margin than the large bond issue.
Hammer cautioned that the school board needs to communicate clearly with constituents about the tax impact of both board-approved and voter-approved projects, so that a surprise bump in property taxes doesn’t lead to trust issues. However, Safratowich said that as property values change, it can be hard to compare one year’s tax rates to the next.
High school deferred maintenance
Board members debated which deferred maintenance projects at the high school are most urgent, and which could be done as standalone, board-approved projects. Options included renovating the high school restrooms to comply with the Americans with Disabilities Act, parking lot maintenance, replacing exterior metal wall panels, replacing roofs and expanding the reach of the building’s dehumidification and cooling systems.
“Honestly, there isn’t one thing on this list that does not need to be done,” said Safratowich. “It’s just a matter of when do we do them or how do we fund them.”
Dodge asked how many pieces of the project could be funded with Elementary and Secondary School Emergency Relief (ESSER) funds. Hammer replied that uses of ESSER funds are very restricted, and he advised the board to look for a balance between doing regular maintenance and tying up all their long-term facilities maintenance funds on a big project.
Carlson suggested having Vanderstad and other knowledgeable staff advise the board about which deferred maintenance issues are most important.
Splett said if the school board decides to have a bond referendum on the November ballot, Aug. 4 is the deadline to submit their review and comment to the Minnesota Department of Education, and early voting would start in mid-September.
Since this would be another special election in a non-election year, Bagstad said, getting people to the polls will be a challenge.
Splett said elections in 2022 are in February, August and November.
Glenn Chiodo with ICS stressed the importance of being clear with voters about the tax impact of both the voter-approved and board-approved components. He said the board’s next big decision will simply be which improvements to fund via each funding source.
Hammer urged the board to look for the tax capacity – described as the “tipping point” dollar amount between what voters will or won’t accept.
The school board will continue this discussion at its next regular meeting, scheduled for 6 p.m. Monday, June 21 at the Frank White Education Center.