So where do we go from here? The three schools are in pretty sad shape. M.R. Reiter, the worst of the three, is not salvageable without major renovation. I partially agree with Marlys Mihok that the site would make a great park. It would also make a great light business location too. Maybe doctor's offices or accounting offices, something like that. Why can't we make the location assume some of our tax burden and become productive? This is a debate for another time though.
Grandview is in bad shape too. This is the unspoken assumption that was there in the K-12 proposal from the previous board: All three schools are in bad shape. All of those parents who thought that the elementary schools were somehow "safe" from major upheaval once the evil K-12 building was defeated need to re-examine the situation. Renovation items from all three schools were, quite reasonably, postponed under the assumption that a new building was coming. Now they need to be addressed.
We're going to be renovating the Six Million Dollar Shell. Is that enough money to do the job? Aside from Emperor William Hellmann CPA, I'm not sure anyone else believes it is.
There are four boilers at MHS and all need replacement. Will they stay as fuel oil boilers, or convert over to gas? Where are energy prices heading? I assume that "down" is a safe incorrect answer.
The current windows assume cheap fuel prices. Will the new windows be the same size or smaller? Smaller means the walls need to be addressed as well, and the current AC units removed and patched over.
Electric? What's coming into the school, circa 1957, assumes open windows in warm weather (no AC units) and the occasional filmstrip projector being used. Today, there are multiple computers in each room (with each monitor, CPU, and printer needing an outlet), coffee makers, microwave ovens, electric pencil sharpeners, fans, televisions. I would safely assume that the electricity being used today is 10 times over what it used to be back in the Eisenhower Administration.
That's the tip of it. How many home repairs have you done only to find that the job is more that you expected? One items leads to another and soon, there's ten items to repair where there once was only one.
So this is where the engineers and architects come in. They need to survey what's there, what can be done, and the cost to do it. Has this been done yet? Where are the written reports, estimates, quotes, findings. etc? What plan is being used here, other than the plans of Emperor William Hellman CPA?
Incidentally, considering the William Hellman CPA designed and maintained borough finances are tanking too, tell me again why we're allowing him to work on the school budget. Someone? Anyone? The lack of a borough tax base is one of the reasons why this issue has arisen, and what did William Hellman CPA do to make things better or worse?
We also have to consider the capacity of the buildings. Will the physical MHS site accommodate a K-12 building? I don't have the floor plans and utilization figures available to me. My answer is *probably*, but I don't know. Reiter is a goner, so maybe renovate Grandview as well as a K-3 or 4 building, and bring the 5th grade over to MHS if there's not enough room. OK. Will six million refurbish TWO shells? Oops...maybe we need to keep $10 million? Well, since no one is doing the due diligence, who knows? We need to establish the costs involved in each of the options, along with the pluses and minuses. These are feasibility studies in the real world. Where is the MVSB's study? Nowhere, that's where.
There's a lot of emotion that goes with this whole question, and we've paid the price for it over the past few years. The seniors feel cheated out of their retirement money. The parents feel cheated out of a safe educational facility for their children. All of the homeowners feel cheated by the lack of a tax base to relieve the crippling taxes.
Let's sit back and take a deep breath and dispassionately examine this issue openly (sorry, Marlys, no executive sessions) with a somewhat open mind and in a general spirit of cooperation. The truth, and the eventual solution, lies somewhere in the middle, where it always was. We just need one of Kate Fratti's heroes to lead us to that point.
Who is going to step up?
Saturday, January 26, 2008
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4 comments:
Wow, there are a lot of questions in there. I don't pretend to be a Fratti Hero (although I do play one on TV), but here's my take on things.
From Defeasement, Part I. When it was clear that the Stop The School candidates would probably win, Bond Counsel was asked about paying off the bond early. We can't do it. There is a minimum 10 year call on the bond. That means we still have a little under 8 years to go. So, we can invest the money and try to offset the interest rate that we're currently paying. But, as Jon pointed out, with interest rates tanking, we would probably have to make more risky investments to keep up.
I supported a new building because I believe it is the best choice. But, to paraphrase William Hellmann, CPA, I got the point. I'm over it and would gladly accept renovations. However, $6M is simply not enough to do the job. As STS points out, there's a lot to be done across all buildings.
So for a moment lets entertain the idea of the HS as a K-12. I had had that conversation with Harrison Bink. He believes the building is not well suited for it because of its size. How can that be, I'm sure you're asking, because the HS is almost the same size as the building they were going to build. That is true, however there are other issues with this: [1] there is a lot of wasted square footage, such as long hallways that only connect other hallways, big wide common areas, etc; [2] the layout is not conducive to dividing an elementary, middle, and high school, [3] there is plenty of renovations that would need to be done there as well.
That said, I would gladly entertain the idea, have an architect look at it (again) and see what it would take to make it work. The 2005 Feasibility Study (yes, it really was almost 3 years ago) estimated that renovating the HS would cost between approx $13.5M and $14.5M and that was as a HS, not a HS plus retrofitted as an Elementary. Incidentally, Option 1 of the feasibility study was to renovate the HS and add on an Elementary school for a total of $23.4M.
Also, during my time on the board, I had spoken to a member of the Pennsbury board on the topic of renovations. They begin a school renovation about 1 per year, so they are somewhat of an authority on the subject. The woman I spoke to said that renovations typically cost them between $12M and $15M each.
Of course these numbers were then, and this is now. Fuel costs impact everything, as we all know (anyone bought a gallon of milk recently?!?), and would, IMHO, have a huge impact on cost estimates of everything from steel to windows to boilers. I believe the same exact building, if put out to bid today, would be substantially higher than it would have been only a year ago. Yes, interest rates are lower but costs would be higher. In the end, I believe, Total Cost of Ownership (TCO) would be a wash.
So, is Deafeasement the right thing to do or the wrong thing to do? Short answer is we don't know. Personally, I'd like to see William Hellmann, CPA (a.k.a. The Six Million Dollar Man), present a financial model of what-if's first. What if we Defease the money and take out a smaller bond? What is the real impact? Show me the spreadsheet.
But first tell us the plan.
P.S. I would put together such a spreadsheet but "The People Have Spoken!"
Speaking of the Eisenhower Administration, was that Hellmann's bond squad defeasement guy I saw at last Wed.'s board mtg? If so, he bears a striking resemblance to Adlai Stevenson, who lost the 1952 and 1956 Presidential elections to Eisenhower. How fitting.
Peter,
Me speak too. Me want spreadsheet. Me want spreadsheet!
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