FINANCIAL SIDE OF HIGH SCHOOL BONDS UNVEILED

By Chris Cook - Forks Forum editor

The estimated bottom line cost to taxpayers for a proposed 34,000 square foot expansion of Forks High School has been calculated.

Jon Gores, a senior vice president with the Seattle office of investment firm D.A. Davidson & Co., one of the Northwest’s leaders in financing public school construction, provided proposed bond tax rates for the expansion at a public meeting held Thursday, June 19 by the Quillayute Valley School District (QVSD).

Gores described how financial firms determine bond ratings for school districts.

He said adding the value of timber to the value of property and other economic indicators of a community is a plus for the QVSD.

“It’s unique, we don’t see that in many other school districts in the state,” Gores said.

His figures showed a growth rate of 6.6 percent for Forks and surrounding areas included in the QVSD boundaries.
The timber industry going up or down will have an effect on interest rates, he said, adding that his firm will take a conservative approach in estimating the economic future of the area in issuing the bonds if taxpayers approve the bond issue in the Nov. 4 general election.

They also look at what percentage of the vote is in favor of funding the 30-year bonds, he said.

Gores said interest rates are unpredictable, and current rates are historically low. He estimated that rates could rise three-quarters to one percent by the time the bond issue is firmed up.

He presented overall funding costs for several construction scenarios, and two tax rate estimates, one based on the relatively low value of timber sales in 2004 and one based on the considerably higher value of timber sales in 2007.

The higher timber value produced an estimated tax rate increase of $1.50 per thousand dollars of property valuation for $12 million in bonds, and $1.84 for $15 million in bonds. That would be on top of the existing $1.02 per thousand already being paid by property owners living in the QVSD for past improvements to Forks Elementary School.

For $12 million in bonds, the total interest cost over the 30-year life of the bonds would be between $10.6 million and $10.73 million. For the $15 million in bonds, the interest cost would be between $14.4 million and $14.6 million.

He said the QVSD will likely rely on using the state’s high bond rating in support of the bond issue, which he called a benefit for Forks.

The cost of the bonds would depend on the size of the expansion of the high school, and how the Forks economy is valued when the bonds are issued.

The estimated principal cost of the high school expansion is about $18.6 million, with about $6.96 million paid for in matching funds coming from the state Office of the Superintendent of Public Instruction.

The high amount of matching funds has a narrow window of time, QVSD Superintendent Diana Reaume said. “It’s a one-time, very unique situation” that counts the some 1,100 “virtual” students enrolled in Insight School of Washington, an online school that falls under the QVSD.

Reaume said she has been told by OSPI officials that the situation is likely to change in the next session of legislature.
Earlier estimates showed about $1.5 million in state matching funds.

Gores handout showed that the principal cost of the bonds, not including interest over its 30-year life span, would drop to about $12 million if just the high school expansion is funded.

Adding a new Spartan Stadium grandstand area plus a synthetic field surface would add about $3.5 million to $4 million to the cost, a representative of Tacoma-based BLRB Architects told the meeting.

Key dates
Reaume said the QVSD board has an Aug. 12 deadline to file the bond issue with Clallam County if it is to appear on general election ballots on Nov. 4. The QVSD board’s vote on the bond issue is expected to be made at their Aug. 5 meeting.

Facade
Tom Bates, a managing principal with BLRB, discussed the issue of preserving the existing facade of the entrance to the 1925 Forks High School building.

He said plans call for taking down and reassembling the brick building face, likely with new bricks, or replicating the facade in a new section of the high school.

Bates said the 1925 building is likely ineligible for historic preservation status as it has been modified a number of times over the years.

Other preservation issues include saving maple trees located on the grounds of the high school and the well-known wooden Spartan sign, plus salvaging a time capsule placed in the 1925 building when it was constructed.

Reaume said the high school administration is currently packing up and moving out of the 1925 building into the high school annex, with their office going offline at the school as part of the agreement with OSPI during construction of the first phase of the high school expansion completed in 2001.

Stadium issue
Replacing the grandstand and laying down a synthetic field surface at Spartan Stadium was also discussed.
Bates said the field is in bad shape and despite high maintenance costs still turns into a mud bowl over the progress of the football and soccer seasons.

He presented a proposal for a new covered grandstand that would seat 800, have a built-in public address system, with two team locker rooms with showers underneath. In addition, the stadium work would include a press box atop the grandstand, public restrooms, a concession stand near the stadium, storage facility under the grandstand plus a synthetic field and new scoreboard. The running track would stay, he said, with drainage pipes for the football field placed under the track.

The grandstand would have a bigger footprint than the existing one, Bates said, because wider aisles are needed to meet safety codes.

The life of the synthetic field would be about 15 years, though some existing ones in the state are lasting longer, he said. The artificial grass would not be like astroturf, but more like real grass, with tall blades, and a sand mixture within the grass. The field work would cost around $800,000.

Reaume said she is calling contacts in the education field across the country to see if grants or other funding sources for the athletic field are available.

She said a bond funding campaign committee is being formed outside of QVSD control to promote the bond issue within the Forks community.

Also discussed was integrating the bio-mass boiler planned for the high school and middle school and recently funded in part by the Legislature into the plans for the high school expansion.