Sunday, July 20, 2014
R-8 Board to vote on financing to cover $8 million spending spree
At the 7 p.m. Tuesday Joplin R-8 Board of Education meeting, the board will vote on resolutions to cover at least $13 million in spending, including $8 million that CFO Paul Barr described at the May board meeting as "might-as-well" spending.
The vote will take place during the same meeting at which the board is introduced to members of the state auditing team that will be in Joplin for the next several months poring over the school district's books.
The C. J. Huff Administration is seeking short-term financing to cover $5.4 million in debt that was incurred during construction of the new high school because of problems with the old mines on the site.
Long-term financing is being sought to cover the "might as well" list, $8 million in spending that C. J. Huff approved because it "might as well" be done to keep from having to do it later. The items were not included in the $62 million bond issue approved by voters in April 2012.The items that Barr mentioned that fell into this category included the following:
-Lights at multiple athletic fields
-Artificial turf at multiple athletic fields
-Expanded tennis courts from four "before the storm" to eight
-A track at the high school, so the athletes would not have to go to Junge Stadium and practice with middle school students
Barr said that was just "a sampling" of the "might as well" items.
To pay for the spending spree and to get around constitutional requirements that voters get to make the decision on whether a school district goes into long-term debt, the R-8 Board of Education will be asked to pass a resolution authorizing "a sale of series of lease certificates of participation to finance school facilities for Joplin Schools to be accomplished pursuant to annually renewable lease purchase agreement."
Certificates of participation have become a popular financing instrument in recent years enabling municipal government and school districts to incur debt long term by changing it to a year-to-year lease. The instrument was first created in California in the late '80s after the passage of Proposition 13 designed to cut the cost of government made it difficult for California governmental entities to finance construction projects.
While the $8 million in "might as well" spending has been the reason cited for the need for the long-term financing, cost overruns are reportedly astronomical in the construction of Joplin High School/Franklin Technical Center and could also be covered by this financing instrument.
District officials have said that much of the money will be recovered when payments are received from FEMA and SEMA.