BOARD FINANCE COMMITTEE MINUTES

NOVEMBER 7, 2005

 

 

Members of the Board Finance Committee met on Monday, November 7, 2005, at 8:05 p.m. in the Superintendent’s Conference Room. Present were School Board Members Charlene Koch, Diane Rowe, Dr. Craig Haytmanek, Rosario Amato, William Heske, Margaret Williams, Julie Venanzi, and Loretta Leeson. Also present were Dr. Joseph A. Lewis, superintendent of schools, Stanley J. Majewski, Jr., assistant to the superintendent for finance and administration, student board representatives Issac Sharkan and Laura Collins; Jamie Shelby from Arthurs LeStrange, Brian Koscelansky from Stevens and Lee, and Robert Davidson from Abbott, Davidson and Weiss.

 

Courtesy of the Floor - None requested.

 

Open Forum – Mr. Heske presented a proposed resolution requesting legislators to allocate two percent of revenues received from gaming to host school districts to offset the additional expenses incurred by districts as a result of “no child left behind” requirements. This resolution will appear on the November 21, board agenda.

 

Financing Options – The district has allotted $110,000,000 for construction projects for Liberty, Freedom and Broughal. Mr. Majewski calculates that an additional $30,000,000-$35,000,000 will be needed to complete the three projects. He is suggesting that the district enter into a Forward Start Agreement for $35,000,000 while interest rates are still low. The settlement date would not be until September 2007.

 

Discussion followed with regard to the amount of money the district will need for future capital improvement projects as a result of growth in Bethlehem and Hanover Townships. Several schools will need additions, and the possibility exists that another elementary school will be needed to accommodate the expected population growth. The committee discussed borrowing $40,000,000 in anticipation of these capital needs.

 

Mr. Majewski stated that the money must be spent on capital improvements or the district would be penalized. He did not foresee a problem with meeting this requirement as the district has many projects in the planning stages. The additional debt service for $40,000,000 would result in an annual appropriation of approximately one half of a mill to the General Operating Budget.

It was asked what the district’s debt service limit is. Mr. Majewski estimated that it is $337,000,000. We are currently at $295,000,000 and are well within our limit.

The committee was polled and agreed 7 to 1 to increase the funding to $40,000,000.

 

Mr. Majewski is concerned about the rising interest rates and requested that the board hold a special board meeting on November 14, 2005, to lock in the current interest rate which is under four percent. The committee agreed.

 

Board Finance Committee Meeting Minutes

November 7, 2005

Page 2

 

 

Audit Report Review – Mr. Majewski reviewed a draft copy of the June 30, 2005, Audit Report with the committee. The report had one student activity finding.

 

The benefits budget was exceeded by roughly $3,000,000 last year as a result of increased health care costs.

 

The fund balance was decreased by $2,000,000 instead of $3,000,000 as a result of receiving more state subsidies, increases in real estate transfer taxes, and increases in Mercantile Tax.

Overall, the local economy was healthy

 

Day Care revenues were less than the previous year as a result of changes in the rate schedule. The Day Care fund balance as of June 30, 2005, was $12,735.

 

The district added $55,000,000 in general long term debt. As of June 30, 2005, the total outstanding debt was $209,060,000.

 

Mr. Majewski gave praise to Kathleen McCann for preparing the information needed for the Audit Report. The board will approve the final Audit Report at the January 23, 2006, Regular Board Meeting.

 

Repository Sales – Mr. Majewski informed the committee of two parcels of properties that will be sold by the Tax Claim Bureau for the bid price of $1,000 and $800 respectively. The district must give the Bureau its consent before these parcels can be sold. This item will appear on the November Agenda for approval.

 

Act 72 – Mr. Majewski informed the committee that the district’s solicitor indicated that it is not required to send out Farmstead/Homestead Applications and will not be doing so.

 

The meeting adjourned at 9:15 p.m.

Minutes prepared by:

Adele Embardino, Confidential Secretary to the Assistant Superintendent for Finance and Administration