Monday, February 26, 2024

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Graham, NC 27253
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Commissioners consider next steps, financial options in ongoing mold discussions with ABSS

After two weeks of delays and $18.5 million in decontamination expenses, the Alamance-Burlington school system has been officially declared free of invasive mold.

But while students and teachers may breathe a bit easier in their newly-scrubbed classrooms, there’s been no end to the huffing and puffing among Alamance County’s leaders, who must now figure out what to do to prevent a repeat of the school system’s recent housekeeping crisis.

According to contractors in the school system’s employ, the schools will have to invest untold sums into roof repairs, HVAC upgrades, and other improvements to ensure that its buildings remain untroubled by mold. Some of this work had already appeared on the school system’s to-do list prior to this summer’s fungal explosion.

But these scheduled projects are merely a fraction of what the school system’s contractors believe will be necessary to create mold-free school zones for the county’s students. Meanwhile, the school system’s top brass have come up with a “long-term air quality plan” that seems to call for $45 million in roof work and HVAC upgrades in the coming year as well as another $2.2 million in new personnel [See separate story in this edition].

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Superintendent outlines $225 million in needs over next five years:


In order to pay for these proposed improvements, the school system says it will need some substantial financial assistance from the county’s board of commissioners. The commissioners were also instrumental in funding the school system’s mold eradication efforts, although they managed to bankroll all of that work using revenue that had previously been earmarked for the school system’s capital needs.

But the prospect of additional upgrades will inevitably force the county to draw on other sources of revenue – although not all of the commissioners are eager to break open the proverbial piggy bank at the behest of the school system’s administrators.

One potential funding source at the county’s disposal is the remnant of a $150 million bond package that area voters approved on the school system’s behalf in 2018.

According to the county’s finance department, the county has yet to issue some $19.5 million of those voter-authorized bonds – a fact that hasn’t escaped the attention of Steve Carter, the vice chairman of Alamance County’s commissioners. Carter originally broached the possible use of these unissued bond proceeds during a joint meeting with the Alamance-Burlington school board on September 1. Since then, a financial consultant for the county has assured the commissioners that they can absorb the debt payments on these unissued bonds without having to fiddle with their long-term plan for capital financing.

The proposed use of these unissued bonds has also caught the eye of commissioner Craig Turner based on the consultant’s report to the county’s governing board.

“The bond market will allow us to continue to borrow based on the original scope of the bonds that the voters approved, and that’s about $20 million,” he explained in an interview Wednesday. “The revenue that the county is already applying to bond debt repayment is sufficient to cover the additional bond debt so that no additional tax dollars are needed.”

Turner noted that his $20 million estimate for these funds includes a so-called “bond premium” – a term of art in the bond market that refers to the additional debt that issuer can get when the money they’ve budgeted for their debt payments is more than sufficient to cover the bonds that they initially sell.

Meanwhile, Carter admits that the school system still has a lot of preparatory work it needs to do before the county can offer these remaining bonds to investors.

“They’ve got to do engineering studies. They would also need to have the bids in hand before we could set a date to draw on the bonds,” the commissioner explained in an interview Monday. “I think at our next meeting they’re going to ask for a reimbursement resolution so they can get those engineering studies done.”

Carter added that the commissioners will have to dip into the county’s own savings to front the school system’s engineering fees, although it would eventually be able to recoup the expense from the bond proceeds.

Another revenue source that remains within reach is $10 million in federal pandemic relief that the commissioners had previously stashed in the county’s own capital reserves. Although the county’s administrators have tentatively set this money aside for the proposed expansion and renovation of the Judge J.B. Allen, Jr. Court House in Graham, the commissioners have never formally committed themselves to this project, whose final price tag is expected to be somewhere in the neighborhood of $70 million.

In the midst of the county’s deliberations over the school system’s mold crisis, commissioner Pam Thompson elicited an admission from county manager Heidi York that this $10 million nest egg is technically available for other capital projects.

Thompson insists that she and her colleagues would do well to spend these funds on the school system’s capital needs given their comparative urgency in the wake of the mold crisis.

“That courthouse is not a priority compared to this school system, and that’s $10 million we can use,” she declared in an interview Tuesday.

Thompson’s preference on this score is also echoed by Carter, who contends that the county has other ways to meet the court system’s needs without dropping tens of millions of dollars on an expanded court building.

County commissioner Steve Carter

“[School officials have] got to do engineering studies. They would also need to have the bids in hand before we could set a date to draw on the bonds. . .

I think at our next meeting they’re going to ask for a reimbursement resolution so they can get those engineering studies done.

“We’ll need extra space if we get a fifth district court judge and a public defender [from the state legislature].  But I think we can get that space without having to build a new building.”

– County commissioner Steve Carter

“We’ll need extra space if we get a fifth district court judge and a public defender [from the state legislature],” he added. “But I think we can get that space without having to build a new building.”

Carter suggested that the county could potentially house a new judge or a public defender in the now vacant building at the corner of Maple and Pine streets in Graham that had served as the local elections office until its staff moved into their new headquarters earlier this month.

Meanwhile, Thompson is adamant that the board of commissioners should remain open to other, more painful options to make sure the county’s schools are impervious to mold.

County commissioner Pam Thompson

“ “That courthouse is not a priority compared to this school system, and that’s $10 million we can use. . . I’m going to support whatever we have to do to fix this.  We’re going to have to go big or go home because we have to fix those schools.”

– County commissioner Pam Thompson

 

“I’m going to support whatever we have to do to fix this,” she said. “We’re going to have to go big or go home because we have to fix those schools.”

Turner insists that he, for one, isn’t quite ready to draw on the funds set aside for the courthouse expansion. He added that there may very well have enough money to meet the school system’s needs within the various accounts that the county maintains for ABSS. He alluded to some leftover revenue in the school system’s capital reserve fund, at least $600,000 in unspent proceeds from completed bond projects, and roughly another $1 million or so in uncommitted funds from the school system’s cache of federal pandemic relief.

County commissioner Craig Turner

“There’s a number of accounts that still have funds for ABSS use.  You can cobble together money from different sources.”

– County commissioner Craig Turner

“There’s a number of accounts that still have funds for ABSS use,” he went on to emphasize. “You can cobble together money from different sources.”

But not everyone on the county’s governing board seems to share this same willingness to stretch the available resources to accommodate the Alamance-Burlington school system.

Although all five of the commissioners voted to release the funds for the school system’s mold remediation efforts, the prospect of freeing up even more revenue is getting some push back from John Paisley, Jr., the chairman of Alamance County’s commissioners.

Instead of scaring up the cash to mold proof the schools, Paisley believes he and his colleagues should be scrutinizing the school board’s financial priorities – including its controversial decision to reallocate some federal pandemic relief funds from HVAC upgrades to bonuses for faculty and staff.

“A better question how are they going to repay those funds that they already received and spent on other things like bonuses to themselves. At some point somebody’s going to have to answer for that…They were given moneys over and over again, and I’m sick of the taxpayers having to pay for it.”

– County commissioner chairman John Paisley, Jr.

“A better question how are they going to repay those funds that they already received and spent on other things like bonuses to themselves,” he argued. “At some point somebody’s going to have to answer for that…They were given moneys over and over again, and I’m sick of the taxpayers having to pay for it.”

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