The Scott County School District 1 board unanimously approved the hiring on May 20 following a second public hearing on the proposed project.
The architect’s preliminary plans call for updating the 1936 Austin Elementary School (AES) brick gym and elementary classrooms, razing the 1950 era classrooms and building a new elementary school that connects the classrooms with the historic school building and Austin High School (AHS gymnasium. Additionally, the school board wants to remove the indoor swimming pool at AHS, which was constructed in the early 1980’s, and replace it with a multi-purpose area.
Mike Therber of the Indianapolis based financial consulting firm Therber Brock said that there are two methods of financing a school construction project.
The state Common School Loan fund is available at 4% interest with a 25-year repayment schedule, Therber said, adding that the Common School Loan rate is not changed in a considerable length of time and is not expected to any time soon.
“The maximum loan per year is $15 million so if we decide to go that route the financing would need to be in two phases to pay for a $20 million project,” he said, noting that CSL funding is approved on a first come-first served basis
Therber said the alternative method of financing is through a bond issue. “Currently, bonds are being purchased at 3.5% but those rates fluctuate more than the Common School Loan,” he said.
There are additional costs for advertising and selling school bonds, he said.
“Which method to use could be a ‘game time decision’ as the project moves forward,” he told the board.
Therber said that the tax rate could go to $1.13 for a few years, meaning that for a home with an assessed valuation of $75,000 the tax bill could increase about $220 per year for a couple of years.
“But with the middle school construction loan being paid off in a few years we anticipate tax neutrality (dropping back to around the current 80 cents rate) after that,” the financial advisor said.
The school board voted unanimously to pass a resolution to move the project forward. Voters should be able to decide on the proposed building project through a November 7 ballot.