Archived Story

Reed: ‘Still in the black’ for HHS

Published 12:35am Wednesday, November 14, 2012

The cost of the constructing the new Hartselle High School is more than $44.28 million, but Hartselle School Superintendent Dr. Mike Reed said the system has enough money to cover its costs.

In fact, he believes they will have more than $41,000 left over when the project is completed.

“With the new numbers, we’re still going to be in the black,” Reed said at the Oct. 25 board of education work session.

The school system began the project with just over $42.504 million in funding, $2.226 million from Gov. Bob Riley’s 2007 bond issue, $21.933 million from President Obama’s stimulus bond issue and $18.345 million in a bond issue, which will be repaid by a one-cent sales tax passed by the Hartselle City Council.

That leaves a difference of $1.776 million not covered by the bond issue. However, schools chief financial officer Sarita Tapscott said the school system will make up the difference by capital outlay funds, sales tax savings and grant funds.

Specifically, the school system is using $914,157 in payments from the City of Hartselle, which is refunding the school system’s capital outlay fund. Tapscott said the Alabama Department of Education is deducting interest payments on the Qualified Schools Construction Bond (QSCB) from the school system’s capital outlay funds.

The QSCB bond is the $21.922 million bond made possible by the American Recovery and Reinvestment Act of 2009.

“The city is reimbursing us for the capital outlay funds that the state is using to pay interest on the QSCB bond,” Tapscott said. “These payments from the city are being funded by the one cent sales tax that was passed several years ago.”

Tapscott said that city will receive those payments from the city even after the new high school is completed.

“We will use this money for our capital outlay fund,” Tapscott said.

Tapscott said the school system could get $300,000 in savings from the $1.1 million in Alabama Transportation Rehabilitation and Improvement Program, which will pay for the Bethel Road improvements and repaving in front of the new high school.

The school system has also budgeted $500,000 in sales tax savings, but Reed said that number could be higher. In fact since the project began, the project has already had $547,763 in the first five fiscal quarters of the construction.

“We budgeted that number very conservatively,” Reed said. “We could potentially have more.”

Combining those anticipated revenues, the school board would have $44,218,146.50 in revenues. The cost of the school is estimated to be $44,280,091.90, including a $165,000 revision to the $1.999 million field house to include softball facilities.

That would leave $61,945.40 unfunded in the project.

Tapscott added that the school system will receive another $103,171.80 sales tax payment from the city in December, which will leave $41,226.40 left over. The numbers are all based on all change orders as of the board of education’s November meeting.

While the final cost of the new high school is still yet to be determined, Tapscott said the school system still has enough money to complete the project, even if it has to dip into the general fund reserves. Currently, the school system has more than four months of reserve in its general fund and it is only required to have one month of reserves.

“While we are using some capital outlay funds to pay for the new high school, I think it’s important to use this money to complete the high school first,” Tapscott said. “It’s a matter of priorities for now. Once we complete the high school project, then we will continue to get the $103,000 payments each quarter from the city to build up our capital outlay funds again.

“Our school system is still one of the most solvent in the state,” Tapscott said.

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