2015-12-07-AC-STM#1-rpt - Laserfiche WebLink

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APPROPRIATION COMMITTEE - NOVEMBER 2015 STM #1 Projected Budgets for School Construction and Renovation The table below summarizes the current estimates for the cost of construction projects in the School Committee's recommendation. On the proposed schedule, these projects would all require funding within the next three years: Project Project Components Construction Timelines Component Budgets Diamond Base (incl. cafeteria & ILP) HVAC 4/2016 - 8/2018 4/2016 - 8/2018 $34,541,900 $10,000,000 Clarke Base + PCB remediation 4/2016 - 8/2017 $21,264,100 Hastings New construction (no MSBA) 10/2016 - 8/2018 $54,758,700 6 modular classrooms Site prep, installation, and acquisition 9/2016 $2,915,000 LHS HVAC 5/2017 - 8/2019 $13,125,000 LCP (Pre -K) New construction TBD $11,025,000 TOTAL $147,629,700 The table above does not include: • Renovation of 4 classrooms at Harrington for general education use after a new LCP facility is built. • Purchase cost of the property at 20 Pelham Road, which is still subject to negotiation. • Further work at 20 Pelham Road, such as: o Upgrading the existing building to a 10 or 12 classroom elementary school. o Constructing a new elementary school on the site. o Reusing the existing building to house the LCP or the LPS central office. o Constructing a second access road to the site. • Construction at Lexington High School that may be needed as soon as 5 years from now to ac- commodate increased enrollment. • An alternative plan if the Town receives MSBA support for a new Hastings School. Debt Exclusion Financing Under the current plan, at the 2016 Annual Town Meeting the Selectmen are expected to request an ap- propriation of construction funds for all but the LCP (Pre -K) in the table above, followed by a referendum to approve one or more debt exclusions to fund these projects. Should the referendum be approved, some of the existing short -term General Fund debt for qualifying design services would be incorporated into the excluded debt financing. When the Town issues long -term bonds, there can be an abrupt and sometimes substantial increase in debt service, followed by a gradual reduction in the debt service as the debt is paid down. The larger the amount of debt issued at any one time, the steeper the impact will be on the tax payers in the years imme- diately following. The Town can appropriate money from the Capital Projects Stabilization Fund to attenuate the tax in- creases created by new debt service. The Capital Projects Stabilization Fund has a present balance of $16,666,599, and it is anticipated that an additional amount of about $3,000,000 will be added to the Fund at the 2016 Annual Town Meeting. If a debt exclusion referendum for the above projects is approved, the Fund will be used to attenuate the rate of tax increases over several years. The debt will be issued in a mix of durations based on the expected lifespans of the projects that are fund- ed, with some bonds of up to 30 years in duration. Previously, the Town has limited bond durations to no more than 20 years, and the use of 30 year bonds will be a change from past practice. The longer duration 3