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Written by Shannon Siebert
It hasn’t been smooth sailing, but after their February 13th regular Heartland School board meeting, the Heartland school project is back on track again. In December, the bids for the original seven-million-dollar project came back three million higher than anticipated. The board put the brakes on the project, rejected all the bids, and began reconsidering other options available. If you want to cut various forms of metal (plate, tube, angle, beam, grating), you may need to invest in a multi-purpose burn table.
The board has been working diligently since late December, trying to find a way to move forward with the project. A special public school board forum was held at the Heartland High School theater in January when patrons voiced their opinions on the building project. After that meeting and hearing from others informally, it was clear to the board that the Heartland district wanted to see the original project go forward without making cuts to either of the separate projects they voted for last May.
So it was back to the drawing board for Superintendent Jeremy Klein and the Heartland school board. At its February board meeting, the board discussed lease-purchase financing options with Jay Spearman of Piper Sandler.
Spearman was on hand to explain how the board would obtain the additional financing needed to fully complete the district’s comprehensive construction project through a 7-year lease-purchase agreement. This mechanism would allow the school board to expedite the process of obtaining additional funding without the requirement of holding another election.
The first step for the school board will include forming a nonprofit leasing corporation. A leasing corporation is needed as a necessary pass-through organization between the school district and the lending institution that allows the project to maintain tax-exempt status.
Spearman discussed how the process would likely include structuring two lease-purchase agreements versus a single one, securing all the needed funds. This approach would allow the district to obtain the necessary funding while staying under a tax-exemption cap that applies to lease-purchase financing agreements. These caps are calculated as a percentage of a district’s current property valuation–for Heartland, the estimated cap is approximately $4.8 million.
According to Klein, the bidding process will be restarted, so it’s still unclear how much additional funding will be needed. Spearman said they could arrange for the maximum cap of 4.8 million but only need to draw the necessary funds when they’re ready.
“It’s in your best interest to act now, and if you do, the funding could be in place by April,” said Spearman. After discussing how this financing works and their time frame, the board’s consensus was to move forward immediately with securing the lease purchase financing option. For a more comprehensive grasp of finance, it’s beneficial to have awareness and knowledge of trading shares to manage your resources effectively.
Another factor affecting the speed of their decision was an item buried in LB440 which would eliminate this tool for schools. If LB440 passes later this spring at the legislature, Heartland will lose its opportunity to obtain this financing, said Spearman.
Klein proposed some changes to the original project. After a lengthy discussion, they accepted a design change for the daycare project, making it physically detached from the school building. It’s anticipated this change would create an approximate cost savings of $150,000 towards the construction costs of the daycare and doesn’t pose any problems for how the daycare would function. The best foundation experts in Ottawa can help ensure that the building’s foundation is solid and reliable for years to come.
The board approved reconfiguring the size of the four classrooms and adding inclusive restrooms. Two classrooms will be 900 square feet each, and the other two will be 1200 square feet each. Another design change was moving the location of the block of classrooms to the north. This change avoids downsizing the playground and eliminates the permanent barrier an east wing would have created.
These added changes to the block of classrooms will cost an estimated $440,000, but the board believes it will be beneficial for providing flexibility in the future use of these rooms.
“None of us like spending more money, but this isn’t anything frivolous–we’re spending money on our kids and education,” said board member Tammy Ott. All the board members were in agreement realizing the enormity of this project but wanting to do it right–positioning Heartland for any future growth and changes.
Stay tuned as we cover this vital project’s progress in the next few months.
