Monthly Costs of Project

I have received a lot of emails regarding the monthly costs presented at the forum. The following post is on the High School Renovation Blog to explain how the numbers were arrived at:

"During the Community Forum presentation a slide was included to show what the range of project costs would look like in terms of monthly tax increases for a $225,000 home in Mt. Lebanon (the average price of a home sold here in 2007). The numbers are based on bond schedules prepared by the District’s financial advisors using municipal bond rates as of July 18, 2008 and assuming State reimbursement of 16% of the cost of the bond payments. Based on that information, a $90 million project would cost a homeowner about $45 per month, a $110 million project would cost that same homeowner about $55 per month, and a $130 million project would cost about $65 per month."

There were some residents that were confused a bit by the projected monthly numbers juxtaposed against the total project cost. I believe the above information mostly solves that mystery. The post with the linked spreadsheet I had earlier did not include this 16% reimbursement rate.

Thanks for reading.

James

Forum Update

The School Board held the Community Forum on the High School Project last night. There was a wealth of information that was distributed. The documents given out last night is available now on the MTLSD website.

Today I will give an overview about what was talked about last night and later I will post at length about each of the options presented.

There were really four options presented at the meeting last night. Dollar estimates were given last night for each of the options but really, those numbers are still so early in the game (we still do not yet have a Construction Manager for the project) that they really are just educated guesses at this point. I think we ought to take the estimates and give them a range of +-10%. So with that, these were the options presented.

Option 1 was a renovation of the existing structure. This option would essentially bring the existing structure up to code and fix the problems that exist. It would address the seriously outdated mechanical systems in the building and provide for asbestos abatement throughout the structure. I like to compare this option to what was recently completed at all of our elementary schools. Estimated cost of this option was $77.8 million.

Option 1A was a complete renovation with additional significant improvements to certain parts of the existing structure. While this would not include a 'new' building, it would completely change the current Administration building into a learning center for the future while keeping the rest of the school largely the same. Estimated cost of this option was $97.3 million.

Option 2 was a plan to construct a largely new 'wing' of the school. This option would keep intact the existing front on Cochran Road of the Auditorium, Little Theatre, and the current face (B Building) of the school. Buildings behind the front would be demolished in a phased approach that would lead to the large majority of classrooms being held in the new wing built in place of the demolished buildings. This plan would create a 67% new school and 33% renovated school. Administration would be moved into the B-Building. Estimated cost of this option was $118.3 million.

Option 3 was a plan to build a new school. The new building would be built largely on the upper parking lot and practice fields. This would involve very little phasing. Once the construction was complete we would simply move students to the new building. This option also renovates the B-Building on Cochran Road. Administration would again move into this building. Estimated cost of this option is $131.6 million.

Last night was the first time the Board really had a chance to sit down and see all the information presented at one time. It was also the first time that we had a chance to see estimated costs. I think that, given our current economic environment, we all understood that the estimates would come in higher than what the Dejong study showed in January 2007.

Last night it was mentioned during the meeting that for every $25 million we need to finance for this project, it would equal roughly a 1-mill increase in taxes. So a $100 million project could force a 4-mill increase and a new $131.6 million new school would surpass 5 mills. Actually, that rule of thumb is a bit high, but still, these are not insignificant numbers. The page in the presentation that lists monthly costs includes the 16% State reimbursement rate. That monthly number equated to a total millage increase of 3.5 mills, not more than 5. I was able to create a spreadsheet that approximates these numbers however, bond coupon rates over the term of the bond will not be fixed as a simple PMT calculation in a spreadsheet would be. As I get more information on the possible bond issuance, I will let you know.

While it is extremely important to get information out to residents about how this project will effect their pocketbooks, we need to also have the vision to do what is right for our students and our community.

That's all for now. I am going to review the documents again, listen to feedback and post more later this week.

James

Current MTLSD Debt Obligations

One of the things I have tried to get a good handle on is the District's current financial obligations. One of the places I look to is the current and future debt service payments for the District. In order to better understand what we can do, it's important to understand where we are.

First, let me throw some numbers out there. Most of this information can be found on pages 84 and 109 of the 2008-2009 Budget. The District is currently about $72,580,000 in debt. Our average debt service payments between now and the 2029-2030 school year (when current debt will be paid in full) will be $4,958,052. Total payments on this debt will equal $118,993,268 if we do not refinance any of our obligations. Current debt service payments equal about 7% of our budget or 2.4 mills ($240 per year per $100,000 assessed value).

The District currently has four outstanding debt issues. The 2002 bonds are a refinancing of the 1997 Middle School Bonds. The 2002-A bonds are a refinancing of the 1998 Middle School Bonds. The 2004 bonds are a refinancing of the 2000 and 2001 bonds. The 2005 bonds are a refinancing of the elementary school renovation bonds originally floated in 2003.

Below is a chart that shows how these obligations are paid and when they will come off the books:


Click on image for larger picture

You can view the data for the chart here on Google Docs.

Bond payments have been structured in a way to make the payments consistent over time. This consistency allows for the District to plan more easily for future budgets.

Our payments on the 2005 General Obligation Bond spike in 2018 (after all other bonds are paid off, payments on this bond increase) and the interest rate fluctuates between 3.0% and 4.7%. Interest rates today are probably a bit different. You can see here that Reading School District floated a $100,000,000 bond issue on July 15, 2008 and the bids all came back at just under 5% interest. Reading has a Moody's Bond rating of AAA. Upper Dublin School District floated $53 million in bonds on May 20th of this year and and the bids all came back just under 4%. Dublin has an A1 Moody's rating. Mt Lebanon's bond rating is between these two. We have an AA2 rating from Moody's. It's hard to say where our interest rate will end up. If I had to guess it would probably be somewhere in between the two issues mentioned above. It is important to keep in mind that the bonds are competitively bid on and that the interest rate will be determined by many factors outside of just the District's credit rating.

Once we start to get hard numbers on the high school project options, I will be sure to post calculations on the cost of each solution in dollars, mills, and taxes. I will also post how I see each of the solutions benefiting the students and the community.

Until then, I hope to see everyone at the High School Project Forum on Tuesday night.

James

Community Forum

On Tuesday there will be a community forum for the High School Project. This meeting will be held at 7pm in the High School Auditorium. Celli-Flynn and OWP/P will present their conceptual drawings and perhaps talk about rough cost estimates for each solution. For more information on the project, please go to the High School Renovation website.

Following is a list of upcoming meetings:

• July 21- Board Review of revised Alternatives
• July 22- Community presentation of Alternatives- High School Auditorium- 7pm
  
• August 5- Policy Committee Meeting- Conference Room B -7:30pm
  
• August 11- Board Discussion Meeting
  
• August 18- Community comment/Architect Update at pre-Board meeting- 6:30m
  
• August 18- Regular Board Meeting- 7:30pm
  
• August 27- Design Advisory Committee meeting for community input- 7pm
  

The Tuesday forum has been well advertised with letters, emails, and postcards going out to residents in Mt Lebanon. I expect attendance will be high.

James

Pennsylvania School Construction Buzz

We are getting closer to making the decision on the high school project. I have posted here recently about future discussion and community meetings. One of the reasons I started this blog was to share my sources of information with readers. Besides listening to folks and getting an idea about how much each possible decision will cost an individual taxpayer (which I have broken down and will post when we have actual numbers), it is important to understand data that is out there that can help in the decision making process.

Today I will point out two sources of information, each from the Pennsylvania Department of Education, and I encourage you to read them. They both contain very important information about costs, community involvement, decision making processes, and even PlanCon reimbursement guidelines.

The first source is called "Renovate or Replace? The case for restoring and reusing older school building". This publication was produced by the PDE, Pennsylvania School Boards Associations, Pennsylvania Historic Schools Task Force, and The American Institute of Architects. It includes sections on older school renovations, lifecycle planning and much more. An emailer had pointed out this document to me because it includes an entire chapter titled, "Mount Lebanon Achieves Academic Excellence, Retains Character with Renovated Neighborhood Schools." Even though it is 32 pages, it's a pretty quick read with a ton of examples of restored buildings.

The second source I want to point out is a study of renovations versus new construction costs that has been completed by The Pennsylvania Department of Edcation. This document is simply a list of completed school construction projects from 2003-2006. You can view the document here. The conclusion of this document is that new construction has on average cost $212.99 per square foot for the years in the study. Renovation has on average cost $114.16 per square foot for the same time period. Again, this study was based on PDE's own statistics.

I also have one final note. There has been talk in the community about obtaining a LEED certification for the high school project. As I understand it, a LEED certification can be gained for either new construction or for major renovation. The LEED for Schools 2007 Checklist can be found here. At the top of the page is a table that shows how many points you need to reach in order to obtain different levels of LEED certification. There are a lot of points to be gained under the Material and Resources section that have to do with re-use of building and waste management. There is a lot I don't understand about the form including the section on Optimize Energy Performance where you can gain up to 10 points towards your certification. I'll keep researching and let you know what I find. I don't know yet if LEED certification is the direction we should go but the option at least needs to be on the table for discussion.

Fourth of July

The true greatness of the Declaration of Independence cannot be summed up by a simple blog post. I present it below courtesy of USHistory.org.

IN CONGRESS, JULY 4, 1776

The unanimous Declaration of the thirteen united States of America

hen in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. — Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

He has refused his Assent to Laws, the most wholesome and necessary for the public good.

He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them.

He has refused to pass other Laws for the accommodation of large districts of people, unless those people would relinquish the right of Representation in the Legislature, a right inestimable to them and formidable to tyrants only.

He has called together legislative bodies at places unusual, uncomfortable, and distant from the depository of their Public Records, for the sole purpose of fatiguing them into compliance with his measures.

He has dissolved Representative Houses repeatedly, for opposing with manly firmness his invasions on the rights of the people.

He has refused for a long time, after such dissolutions, to cause others to be elected, whereby the Legislative Powers, incapable of Annihilation, have returned to the People at large for their exercise; the State remaining in the mean time exposed to all the dangers of invasion from without, and convulsions within.

He has endeavoured to prevent the population of these States; for that purpose obstructing the Laws for Naturalization of Foreigners; refusing to pass others to encourage their migrations hither, and raising the conditions of new Appropriations of Lands.

He has obstructed the Administration of Justice by refusing his Assent to Laws for establishing Judiciary Powers.

He has made Judges dependent on his Will alone for the tenure of their offices, and the amount and payment of their salaries.

He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people and eat out their substance.

He has kept among us, in times of peace, Standing Armies without the Consent of our legislatures.

He has affected to render the Military independent of and superior to the Civil Power.

He has combined with others to subject us to a jurisdiction foreign to our constitution, and unacknowledged by our laws; giving his Assent to their Acts of pretended Legislation:

For quartering large bodies of armed troops among us:

For protecting them, by a mock Trial from punishment for any Murders which they should commit on the Inhabitants of these States:

For cutting off our Trade with all parts of the world:

For imposing Taxes on us without our Consent:

For depriving us in many cases, of the benefit of Trial by Jury:

For transporting us beyond Seas to be tried for pretended offences:

For abolishing the free System of English Laws in a neighbouring Province, establishing therein an Arbitrary government, and enlarging its Boundaries so as to render it at once an example and fit instrument for introducing the same absolute rule into these Colonies

For taking away our Charters, abolishing our most valuable Laws and altering fundamentally the Forms of our Governments:

For suspending our own Legislatures, and declaring themselves invested with power to legislate for us in all cases whatsoever.

He has abdicated Government here, by declaring us out of his Protection and waging War against us.

He has plundered our seas, ravaged our coasts, burnt our towns, and destroyed the lives of our people.

He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation, and tyranny, already begun with circumstances of Cruelty & Perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation.

He has constrained our fellow Citizens taken Captive on the high Seas to bear Arms against their Country, to become the executioners of their friends and Brethren, or to fall themselves by their Hands.

He has excited domestic insurrections amongst us, and has endeavoured to bring on the inhabitants of our frontiers, the merciless Indian Savages whose known rule of warfare, is an undistinguished destruction of all ages, sexes and conditions.

In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince, whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.

Nor have We been wanting in attentions to our British brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity. We must, therefore, acquiesce in the necessity, which denounces our Separation, and hold them, as we hold the rest of mankind, Enemies in War, in Peace Friends.

We, therefore, the Representatives of the united States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these united Colonies are, and of Right ought to be Free and Independent States, that they are Absolved from all Allegiance to the British Crown, and that all political connection between them and the State of Great Britain, is and ought to be totally dissolved; and that as Free and Independent States, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which Independent States may of right do. — And for the support of this Declaration, with a firm reliance on the protection of Divine Providence, we mutually pledge to each other our Lives, our Fortunes, and our sacred Honor.

James

June Emails

I had some interesting emails in June. Three of them are below. As always, I will answer the best I can.

From R:

Mr Fraasch,

I am one of the people in Mt Lebanon that has lived most of my life here. You knocked on my door when running for office and I gave you my vote last fall. I read your reasoning behind your vote on the budget on one of your earlier posts and agree with you. After seeing the schedule for the high school project I became worried that after all this time planning the project that the Board is rushing to a decision. Is the Board really going to have all the information it needs to hold a vote in September? I have tried to keep up to date on the progress of the project but have seen nothing until now and when I see the update I see a vote in three months. How is the community going to give the input that was promised to them in that short amount of time?

Thank you and keep up the good work.

Mr. H,

Thanks for the email. Obviously, the high school project is on a lot of peoples minds lately. The update I posted on my blog was from an administrative session last Monday. That Tuesday there was a meeting of the Design Advisory Committee that is made up of people from the community that have been involved since the Dejong study was started. I'd like to see how the meetings go in July so I can get a better idea of where we are. I do have some concern that too many people will be on vacation in late July when we have the next meetings but again, lets see what happens. The Board has not seen any drawings at all of any kind of solution, only concepts. I'll let you and everyone else know when I hear something new.

From P:

Mr. Fraasch,

I read your posting about the 'Coaches' article in the Tribune-Review. I am a graduate of Mt Lebanon High School and went through the math curriculum that is being replaced now. It did me well but I had no idea that this many years later they would be teaching from the same books that I was taught from. I was concerned that you voted against the budget because you were against the sort of curriculum upgrades that are sorely needed. Your post set me straight.

I do have a criticism. I would like to see you be more vocal at the meetings about your ideas. I read your blog posts and don't always see your ideas talked about when watching the meetings on the television.

Ms. P,

As I said in my post about the 'Coaches' article, we need to give our teachers the tools they need to succeed. This will lead to better outcomes for all our students.

To your second point, this whole time I have been thinking people wanted to hear LESS of me. Seriously though, all of my ideas have been expressed to at least one Board member or another at some point. If during those conversations I think the idea has any merit, I would typically talk about it at a public meeting or talk to more Board members about it. Other times, its just not appropriate to bring things up in a normal discussion/voting meeting. The Audit/Finance Committee post I had earlier is the perfect example of that. All of the ideas I had in that post were addressed at the Audit/Finance committee meeting. Those ideas needed some more fleshing out before making it to a regular discussion meeting. That meeting is not televised which is one of the reasons I posted the ideas on this blog.

From A:

I am aware that there was a survey for full day kindergarten in past years, which I participated in. I was told the vote was 50/50. Do your foresee implementing full day Kindergarten by the 09/10 school year?

The way it is now the half day program is so structured there is not enough time for the Kindergartners to take a field trip, Mt. Lebanon is one of the only School Districts who do not have a full day class or option.

For some children a half day program would be taking a step backwards. This leaves three options for us. Either send our child to a private school, move, or send our child to half day Kindergarten with enrichment from an outside source.

Please give me a timeline when this will be discussed again. A message that I received from Joe Rodella two years ago stated that full day Kindergarten will not be implemented unless the State mandates it. I hope that this issue will be revisited before this.

I feel if you redo the survey attitudes may change.

This is a really good email. It touches on many things that do not have anything to do with kindergarten. Budgets, mandates, attitudes, etc. There are many studies coming out now that are saying how important early childhood and kindergarten education are. There is definitely not a consensus at this point about which direction kindergarten should take in Mt Lebanon. Many parents love the half-day set up and many find it frustrating. There are opportunities for parents to have their kindergarten-age children in school all day if they enroll them in the Mt Lebanon Extended Day program. While this does cost money, it does not typically cost as much as putting a child in a full-time day care. It also gives the child the ability to make friends in Mt Lebanon. For families where the parents work full-time, this program allows for your child to be in school from as early as 7am to as late as 6pm at certain schools. This is important because many districts in Allegheny County do have full-day kindergarten and for many working parents this is an issue.

I believe that this emailer is correct, full-day kindergarten in Mt Lebanon will probably not happen until it is mandated by the State. However, movement at the State level may be happening faster than most people think. Check out this link that summarizes the State research on half-day vs full-day kindergarten. It certainly looks to be headed in that direction.

Thanks to everyone for the emails. I hope you are enjoying your summer.

James

State Budget Agreement Reached

Governor Rendell and the State Legislature have ironed out the final kinks in the State budget. It looks like in its final form that no school district in the state will receive less than a 3% increase in State funding. In the budget we passed in May, Mt Lebanon had budgeted for a 1.5% increase based on the information we had at the time. While this is a nice change, the amount we get from the state (between $5-6 million in basic education subsidies) is relatively small in comparison to what we get in real estate taxes. Additionally, the agreement funds special education services at a 1.7% increase instead of the original 3% increase proposed by the Governor. All in all, it looks to be a wash for Mt Lebanon.

You can read the Philadelphia Enquirer story here.

The other part of this story that is not being reported enough is that it appears that a Statewide Graduation Competency Exam is off the table for now. You may remember that the Mt Lebanon School Board passed a resolution opposing GCE's a while back. It was good to see our elected officials in state office stand up to this idea. This budget includes no funding for the GCE's.

James