Saying “we believe it’s time to act on our own,” School Committee Chair Jennifer Glass outlined next steps for a town-funded school project at a multi-board meeting earlier this week.
Glass told the Board of Selectmen last month that her group recommended not applying again for state funding, but start the planning process for a school project that the town would pay for by itself. At the multiboard meeting, she explained the committee’s reasoning, while Finance Committee Vice Chair Jim Hutchinson outlined some funding and property tax scenarios.
There will be two warrant articles at Town Meeting next month—one on whether to spend a previously approved $750,000 on a town-funded school feasibility study, and another on whether to reapply for state funding—but “we see that as a fork in the road, an either/or choice,” Glass said. The increased competition for state grants and the immediate needs of the Lincoln School from both facilities and educational standpoints mean that waiting any longer is not the best option, she said.
Previous meetings and votes indicate that there is community consensus on four points:
- The education value of a school project is a top priority
- Residents understand that the town will have to spend a minimum of $30 million for a “responsible project”
- There is “strong support” for a project that would cost $45 million to $60 million even without state funding
- There is interest in planning collaboration for a school project and community center
The cost estimates were provided by Dore and Whitter in their report in late 2014. At that time, they outlined three groups of renovation and construction options and price ranges:
- Option 1 – facilities needs only: $12–$29 million
- Option 2 – facilities needs plus “a la carte” educational enhancements: $29–$47 million
- Option 3 – facilities needs plus comprehensive educational enhancements: $54–$66 million
The new feasibility study process would again outline the school’s needs, the town’s educational and community vision and building options, as well as an eventual a decision on one option to put forward for a town vote. The Dore & Whittier report did some of this but did not include faculty input, nor did it address the overall site plan in terms of roadways, athletic fields, etc., Glass noted.
Borrowing costs
Although construction costs have climbed since 2014, interest rates have remained steady, Hutchinson said. The Finance Committee has consulted with bond advisors and concluded that the town can borrow up to $80 million without losing its AAA bond rating, which affects future borrowing costs. That level of borrowing would drive the town’s debt-to-operating ration from the 3-4% range up to 12-13%, he said.
To soften the tax impact, the Finance Committee recommends additional steps such as repaying the bonds over 30 years rather than 20. Also advisable is a “level debt” whereby annual payments would remain the same, though they would effectively decline as a percentage of revenue over time due to inflation, Hutchinson said. Although the town has a debt stabilization fund, spending all of it is not a good idea, because “there are always unanticipated things that happen to towns and we need to have some kind of buffer,” he added.
Another way to spread out the repayments would be to borrow for a community center and a school project separately “and put it in two lumps rather than one big lump,” Hutchinson said.
Voters at Town Meeting will be asked for a $150,000 appropriation for a feasibility study by a community center building committee that would work alongside the new school building committee. The Board of Selectmen would “mandate cooperation between the two,” Selectman Peter Braun said.
One advantage of not involving the MSBA is it frees the town from having to clearly separate design and planning for a school project and a community center, Glass noted.
Property tax impact
What does this mean for Lincoln taxpayers? Hutchinson did not have final estimates this week (the committee will present them at another multi-board meeting on March 8), but an earlier analysis that assumed a 4.6% interest rate and a more aggressive repayment schedule showed that tax bills would rise by $367 per year on a median-value home for every $10 million that the town borrowed. The median home value is $883,000, so someone with a home of that value would pay an additional $1,101 per year if the town borrowed $30 million, for example.
However, Hutchinson noted that interest rates are actually lower than the projected figure (about 3.4% right now), so the repayment cost would be lower than the example—more like $300 per $10 million borrowed, he said.
Even if the town decided on a “repair-only” direction, it would not be eligible for Massachusetts School Building Authority funding, Glass said. The MSBA has two grant programs: the core program and the “accelerated repair” program, which funds individual repair projects such as roofs and boilers. However, schools who get the second type of funding have no other major facilities or educational flaws aside from the isolated issue, and Lincoln does not meet that standard.
Other area towns have done town-funded school projects in recent years, including a new elementary school in Brookline and a replacement for the Zervas School in Newton. Lexington has done several projects, some with MSBA funding and some without. Wellesley has been turned down by the MSBA several times for a project that would consolidate three elementary schools into two and is also contemplating going it alone, Glass said.
One focus of debate is sure to be which major project to do first. The Council on Aging and the Parks and Recreation Department are advocating for a community center and have suggested that if it were built first, some of its space would be used by the school while staged school construction work was taking place.
But resident Ken Hurd disagreed. “My preference would be if the focus is really the school because this is what we need the most. We’re going to attract more people if we have the school situation resolved. A community center is nice is nice and we need it, but it’s not going to bring people to Lincoln,” he said.
“Town leadership should take a position on what the priorities should be,” said Steve Perlmutter, a member of the 2014 School Building Advisory Committee.
