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Commissioners to consider using bonds for Boger Elementary upgrades
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Published: July 29, 2009
CONCORD — Cabarrus County commissioners said Monday they want to make sure they are fiscally responsible when making a decision about a bond program that is part of federal stimulus funds.
The commissioners conducted a special meeting with the Cabarrus County Board of Education to discuss the Qualified School Construction Bonds program, of which the application is due on Friday.
The program is to be used for construction, rehabilitation or repair of a public school and would allocate about $3 million for a project.
"We build newer schools, but it's our older schools that suffer when it comes to funding," said Holly Blackwelder, chair for the Cabarrus County Board of Education. "It will be nice to renovate some of those."
Blackwelder said the bonds program provides funding for projects of which there would not normally be money for, and it stimulates the economy.
The commissioners will evaluate whether to use it for the Charles E. Boger Elementary School addition and kitchen equipment replacement at various locations for about $3 million.
"We chose Boger because it is a definable project," said Len Witke, construction director for Cabarrus County Schools.
The Boger addition is already being financed as a cash project through the county at the cost of about $1.8 million. Using the bond funds to pay for the project would require compliance of the Davis-Bacon Act.
The Davis-Bacon Act is a federal program that ensures that nonunion and union members earn the same wages, Witke said. But there is a cost impact, and using the bond program for the Boger project would make it cost about $266,000 more than if the county continues to use the cash fund for it.
With the Davis-Bacon Act, the new total for the Boger project would be about $2.1 million.
The advantage to using the bonds program for it would mean there would be zero or low interest, but whether or not this would save more than the approximately $266,000 cost difference is to be determined.
"If we borrow the money, it's 6, 5 or 4 percent (interest) over 20 years, as compared to $266,000," said Jay White, commission chairman. "We have to crunch the numbers and see if it's something we want to participate in."
Regardless of how it is funded, Boger's expected completion date is sometime during spring 2010.
If commissioners decide to not use the bonds program for the Boger project, the school system is preparing to have other construction projects as alternatives when the school board meets at its Thursday work session.
"I think we could probably come up with a number of improvements to equal $3.2 million, but it would be about four, five or six smaller projects," Witke said.
Doing the five or six smaller projects may not be as expensive under the Davis-Bacon Act since additions like the Boger project require more trades, White said.
School system officials have said they will support the commissioners if they decide to look at other alternatives for the bonds program.
At the meeting, the commissioners and school board also discussed the Qualified Zone Academy Bonds program, which is designed to assist school systems achieve high standards.
The QZAB program requires a partnership with one or more businesses, not government agencies, that is equal to at least 10 percent of the interest free capital the program provides.
This commitment is something the school system decided was difficult to acquire in the short amount of time between notification of the program and the upcoming deadline.
The school system intends to apply for the QZAB program next year.
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