BOF Worried About

BOE’s TBDs

By John Voket

A case of “now you see it, now you don’t” between the Board of Education and the Board of Finance over the use of the notation TBD may be continuing for some time. As a result of continuing investigation into the possible need for a high school expansion, the Board of Education wants to continue to mark its budgetary line item regarding a possible new school project with a notation, TBD — to be determined.

But in order to achieve the most accurate formulas regarding future town expenditures and debt ratios, the Board of Finance wants to continue using a $10 million “placeholder” on that line.

During the November 17 Newtown Legislative Council meeting, Board of Finance Chairman John Kortze appeared to report to, and answer questions about, municipal and education Capital Improvement Plans (CIPs). During that meeting, he continued to express to the council a point of frustration he has articulated at finance board meetings going back to at least last July.

“The [finance] board has adopted a ten percent threshold, which is a [bond] rating agency standard on our debt service overlaid against our overall expenditures,” Mr Kortze told the council. “As it stands now, that formula reflects everything in the CIP including $2 million per year for open space, and $10 million for the academy.”

It was later clarified that “the academy” is a name commonly given to the yet to be determined high school expansion proposal.

Mr Kortze said that the Board of Finance put the $10 million in two years ago when they learned about the possible expansion, but were unable to achieve a real cost estimate of the project.

“This past year, we saw they removed the $10 million placeholder and put in TBD again,” he said. “We did that as a gauge, an order of magnitude. The CIP for the board of ed said they needed an academy but there was no cost projection.”

The finance chairman warned the council that the town needs “to be very careful about how we approach what we do.”

Mr Kortze then spoke about a copy of a memo he reviewed following a recent Board of Education meeting that reportedly put the cost of a new academy project at $27 million. Subsequently, at least two Board of Education members and the superintendent of schools confirmed the existence of that memo.

But those education representatives told The Bee that the number was only one estimate based on student population estimates provided by the state. School Board and Space Needs Committee member Tom Gisson said that on December 6 the board expected to hear results of a private population consultant’s projections of student populations going out to the 2012-2013 school year.

Mr Gisson said that once school officials have a chance to consider those new numbers, they may be in a better position to render an estimate on the academy’s costs.

“We’re getting way ahead of ourselves [on the cost projection]. We don’t even know where we’re going to build yet, or whether it will be a new school or an addition,” Mr Gisson said. “I understand the finance board wants to put in a placeholder, but there are still so many variables. We still have more questions than answers at this point.”

Mr Gisson admitted that the $27 million estimate on the memo was, “a very early figure.”

“I estimate the cost will be between $10 million and $27 million, but it may be much closer to $10 million. We still have a lot of value engineering to do.”

Despite Mr Gisson’s hopes of driving the project costs closer to $10 million, School Superintendent Evan Pitkoff said the private consultant’s report was in, and that he would be reporting to the board December 6 that the new student population projections are higher than those rendered by the state.

Mr Gisson, Dr Pitkoff, and school board Chairman Elaine McClure all agree that the higher that population figure, the higher the potential cost for the academy project will be.

“We’d love to be able to tell [the finance board] what it’s going to cost,” said Ms McClure. She noted, however, that the costs could vary greatly based on the single factor of location. “We’re still studying a place to put a high school,” she said.

It is that open cost factor that continues to concern Mr Kortze and the finance board.

“If we plug that $27 million expenditure from the memo that was circulated between [school board finance director] Ron Bienkowski and Evan [Pitkoff], we will be over [the level of debt] we think we should be,” Mr Kortze said. “We’re clear about the need for space, but we are worried. When you consider a $27 million expenditure, it will put the town in a position it may not want to be in.”

Mr Kortze said he understood the $27 million was likely achieved when previous school population projections from the state were factored into the building cost per student.

“If you read the memo, with the backup information, the school board is trying to come up with a number, and that number is consistent with state guidelines [on student/cost ratios],” Mr Kortze concluded. “But we never saw that number in the CIP, it is still listed as TBD as far as the academy budget projections are showing.”