Licking County News

OFCC funding

Bond failure wouldn't necessarily sink SWL plans

By

What happens to the $42.5 million proffered by the Ohio Facilities Construction Commission if Southwest Licking voters reject the district's bond issue?

The $42.5 million sum would be returned to a general appropriation fund, but construction money from the state still would be available to the district, according to OFCC spokesman Rick Savors.

The Southwest Licking school district is seeking a 6.1-mill, 37-year bond issue to raise more than $66.5 million for a $109 million facility construction and renovation project.

The bond issue will be decided on the May 6 primary ballot.

A similar 6.04-mill bond issue failed Nov. 5, 2013, with 3,033 voting against it and 2,598 voting in favor, or about 54 percent to 46 percent.

The May 6 outcome could send district officials back to the drawing board because of the OFCC's timeline.

Savors said construction money is offered to school districts in a 13-month cycle. The Southwest Licking school board on June 3, 2013, voted in a special meeting to approve the OFCC's financial package proposal based on the district's plan.

Once the offer is accepted, districts have "13 months to acquire their legally required local share," Savors said.

"If they do not raise the local funds, the offer of state funding which has been earmarked is considered 'lapsed' and returned to a general appropriation fund," Savors said.

In that instance, Section 3318.05 of the Ohio Revised Code refers to the offered funds as "released."

Lapsed but not

eliminated

Once a school district becomes "lapsed," however, it is not out of the running for construction funds, Savors said. In fact, a lapsed district remains near or even at the top of the list for OFCC funds, he said.

According to ORC 3318.05, "if the district board or the district's electors fail to meet such requirements and the amount reserved and encumbered for the district's project is released, the district shall be given first priority for project funding as such funds become available, subject to section 3318.054 of the Revised Code."

"If they go out and raise their local share, they become the priority for funding the next appropriation cycle," Savors said. "A lapsed district has a higher priority than a new district next up on the listing."

Per the ORC, districts cannot reapply to the OFCC until their local share of the money is raised, Southwest Licking Superintendent Robert Jennell said.

To help lapsed districts avoid seeking a bond that doesn't raise enough money, Savors said, the OFCC planning department will "work with them to update their plans and determine the current local and state shares of the project budget."

"For an offer of state funding to be made to a lapsed district, the local share has to be acquired first," Savors said.

Potential changes to funding

A lapsed district's percentage of funding from the state could change in the new cycle, Savors said. The amount could go up or down, depending on a number of factors that go into the legally mandated formula, he said.

"The actual money may not be the same," Savors said.

Savors said the local match also might need to be a higher amount in the future because of construction costs.

"It's always cheaper to build now than it will be later," he said.

Jennell also said building now would be cost-effective for the district, pointing out the local share of the project cost increased from November 2013, requiring the school board to reduce locally funded initiatives to offset the increase and keep the project cost at $109 million.

Considering all options

If the bond issue is approved May 6, Southwest Licking officials plan to build a high school and an elementary school; renovate the current high school into a middle school; renovate all three elementary buildings; and convert the existing middle school into a pre-kindergarten center, district offices and transportation center.

District officials have said the plan would provide space to accommodate current student enrollment and expected growth for the next 10 years.

Southwest Licking's current enrollment is 3,943 students, Jennell said.

A Dejong-Healy report from last year estimated a fairly level student enrollment of 3,915 in 10 years, but several local factors have given Southwest Licking officials cause to believe the figure might need adjustment, Jennell said.

"We have since asked the OFCC to relook at those numbers due to new housing developments and our current student enrollment count," Jennell said.

If the bond issue is rejected, Southwest Licking officials could consider scaling back the project, but that would require some changes, Jennell said.

"The project could be segmented," he said. "However, this would be a board of education decision and would need approval from the OFCC. Again, local funds would need to be raised first."

Comments