The City Schools have been ramping up their engines to promote their new school building and renovation project. No doubt you will be hearing how wonderful public education is and how this is a much needed work for our community (as if Ashland won't be able to go on without it!). I asked a person who has a great deal of familiarity with the funding of such works (and who would like to remain nameless) to give some detail on the economics of it all. This was the response I got:
New buildings are funded by something called a bond issue. The taxpayers must approve of raising money specifically for constructing a building. In this case, I think they need to raise something like $50+ million to build a new HS and renovate the old HS to accomodate grades 5-8. The cost was something like $56 million but I think they revised that number down - maybe to $52??) I haven't paid that much attention lately and so am not sure if they included a new elementary building in that final decision.
Bond issue funding is different from a "levy" which in Ashland involves raising money either for the general fund (which pays for salaries & benefits, books, etc.) or for permanent improvement issues (repair to roofs, boilers, etc., new school buses, equipment that has a life of over 5 years). Bond issues can't be used for everyday things and they will be for a specific length of time - 30 or 40 years usually.
The State of Ohio has determined that the Ashland district is eligible for a "rebate" of around 36% of the cost of building to be paid from a special State Facilities Fund that was originally set up with tobacco settlement monies. This percentage was raised recently and I think it might be up to 39% now. This is not 39% of $50+ million because there are certain things the State won't pay for, e.g. the State will not pay for a stadium, or athletic practice facilities. The cash rebate from the state is a generalized number that will essentially be negotiated as the project progresses. Sometimes architects and engineers can redesign things or call them different names and get the State to pay for things they might not otherwise pay for. E.g. the State will not pay for an auditorium but it will pay for a cafe-torium, cafeteria/auditorium combo usually found in an elementary school. They will only pay for a certain number of offices in a school bldg but if you call the rooms other names, e.g."tutor rooms," you can get more offices by taking down the "tutor room" signs after the final inspection is over. The rules, exceptions, and name-game-playing go on and on. You want architects who will squeeze the most out of the State - and we do have what I think are the best.
A point to note is that the school district will pay for this building upfront and then get the State money when our "number" comes up. My concern is (and has been from the beginning) that the State will be in such dire straits that it will spend that set-aside-for-building-money on other things and the money won't be there to reimburse school districts. This hasn't happened yet but is always a possibility that we reality people feel must be considered given the State's huge budget deficit.
Two other points to note: (1) An operating levy almost always follows a bond issue because a new building will prove more expensive to operate. AHS sat empty for a year or more after it was built because people wouldn't pass the operating levy to run it. (2) Given the location chosen for this new HS, a levy will surely follow to locate a stadium, practice fields, etc. out there. It will be deemed too cumbersome, too costly, too ??? to keep running back and forth to Community Stadium and the powers-that-be will want facilities out by I-71 so "people driving up and down I-71 can see the stadium lights and think, 'What a great place that must be!'." In other words, in my opinion, you are looking at a bond issue, an operating levy, and eventually some type of levy to build new athletic facilities.
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