Safety Procedures Are Expensive

Co-Authored by Bill Zopf, Board President & Dr. Jean Parr, Superintendent (Beacon) - The students and employees of a school district deserve a safe and secure environment. Yet making improvements to facilities in order to maintain and enhance a safe school environment can be costly. In this month’s column we’ll explain Beacon School District’s eligibility for funds to reduce the cost of certain school construction projects through an exciting new state aid program.
New Funding for School Facilities Improvements

New York State has introduced the EXCEL program to provide additional funding for certain types of school construction projects. EXCEL (EXpanding our Children’s Education and Learning) aid can only be used for improving health and safety, making buildings more energy efficient, adding technology for educational purposes, improving accessibility or increasing student capacity by adding additional building space. It can’t be used for such things as a bus garage project or paying off interest on money borrowed to finance building projects. The Facilities Planning Office of the State Education Department has to approve any building project as eligible for EXCEL aid. Unlike standard state aid for a building project which is paid to the district over a 15- to 30-year period, EXCEL aid is paid to the school district as project costs are incurred.

The state calculates the maximum amount of EXCEL aid for which a district is eligible by multiplying the number of students enrolled in the 2005 school year by either $778.22 for a district defined as high need for building aid purposes, or by $320.46 for other eligible districts. Beacon is classified as a high need district for building aid purposes, making us eligible for funding at the rate of $778.22 per student enrolled in 2005. Our aid is calculated at $2,748,000.

If a school district wishes to use EXCEL aid for a building project costing more than the amount of EXCEL aid, the remaining portion of the project qualifies for the standard state building aid. In the case of Beacon, the state would pay roughly 62% of the eligible portion of the project which is in excess of the EXCEL aid and the remaining 38% would be paid from local taxes. Since the contractors involved with building projects expect to be paid during the project, school districts borrow the money by floating a construction bond and then paying back the bond over a period of years using a combination of the annual standard state aid payments and local taxes.

Here are two examples of how EXCEL aid could be used to fund theoretical building projects. Both examples assume 100% of the projects are eligible for building aid, but some portions of an actual building project - such as the interest paid on borrowed funds - wouldn’t be eligible.

Example #1: If the costs of a project are $9,000,000, the state would give Beacon $2,700,000 of EXCEL aid and an estimated $5,580,000 in building aid. This would leave approximately $720,000 to be paid from local taxes. Since this would be paid out over a 15 year period, the yearly cost before interest payments would be $48,000, spread across all tax payers.

Example #2: If the costs of a project are $7,000,000, the state would give Beacon $2,700,000 of EXCEL aid and an estimated $4,495,000 in building aid. This would leave approximately $55,000 to be paid from local taxes. Since this would be paid out over a 15 year period, the yearly cost to tax payers before interest payments would be just $3,666, which would be spread across all tax payers.
The Beacon administrators are working with the Board’s Building Committee to define a list of items to be included in a building project. This list includes such items as roof repairs, repointing brick work, replacing windows, doors and lights; adding insulation, rebuilding an access road, additional heating/cooling systems, and technology improvements. Improvements would be made at all six school buildings in the district and it is estimated the project would cost between $5,690,000 and $7,000,000.

In order to move forward with a building project it has to be put to a vote of the district residents. We are planning on having a referendum in early 2007. Beacon School District’s eligibility for EXCEL program aid offers us an exciting opportunity to make needed improvements and repairs at little cost to taxpayers. Please be on the lookout for more news on the building project and the date of the referendum.