Portland School Board funds construction cost overruns, plans to cut school budget

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The Portland School District will pay $1.2 million to cover the unforeseen construction costs of two elementary school renovations, leaving the district with about $2.5 million of a $64 million obligation to pay for furniture and any future construction cost overruns between now and the projects’ planned completion dates of January 2023 and December 2023.

The board voted unanimously Tuesday night to pay construction cost overruns with money left over from a previous renovation and funds originally earmarked for furniture, fixtures and equipment.

Members also discussed a request from Portland city officials for the district to cut $1 million from its $133.1 million budget. The council voted unanimously to wait for the city council to vote on the school budget before making any firm decisions.

Reiche Elementary School in Portland, where renovation costs have increased. Shawn Patrick Ouellette/Staff Photographer

The $1.2 million approved by the school board on Tuesday will pay for cost overruns in renovations at Reiche and Presumpscot Elementary Schools. In total, the district has paid about $2 million in additional construction claims related to renovations at Reiche, Presumpscot and Longfellow elementary schools since the projects began about a year ago, and there are still months of construction to go. .

In 2017, Portland voters approved a $64 million bond to pay for renovations to four elementary schools – Longfellow, Reiche, Presumpscot and Lyseth. With the exception of Lyseth, obtaining building permits from the city to renovate schools has taken longer than the district had anticipated. This initial delay resulted in increased construction costs for overtime, winter construction management, and building materials, which have been rising in cost for years. To cover these costs, the district had to move some of the money from the bonds.

To cover final construction claims, the district will use the remainder of the remaining funds from Lyseth, which was completed on budget, and approximately $1 million from the $2.2 million fund for furniture, fixtures and fittings. and school equipment, leaving the fund with $1.2 million. At least some council members are concerned that this will not be enough to adequately furnish all the schools.

“When the time comes to provide the furniture, will we have the money for it?” asked board member Abusana “Micky” Bondo.

No one has answered directly and there seems to be some uncertainty about this.

“We are all frustrated to be in a place where we have to look at funds that have been allocated to another purpose and reallocate them,” said Xavier Botana, Portland school superintendent.

But board members, while admitting they are in a tough spot, praised themselves for bringing the complex renovations to where they are today while simultaneously responding to the pandemic.

“If we step back and look at what we’re doing, it’s great,” said school board chair Emily Figdor.

SCHOOL BUDGET

Last week, citing extreme pressure on the city budget due to inflation and general assistance costs, the city council’s finance committee suggested the school district use federal COVID-19 funds to reduce the school part of the budget burden on taxpayers. This wwould allow the city to keep the total tax lower while advancing its budget.

Figdor said using one-time federal funds for current expenses would not be sustainable and the district should use sustainable funding for programs and positions so they can rely on and rely on them.

But Botana outlined four potential ways for the school district to move forward, one calling for tapping into federal funds. Botana simply recommended rejecting the city, and offset a decrease of $1 million with $1 million from the district fund balance, offsetting a decrease of $1 million with federal COVID relief money or a reduction in the budget of $1 million by cutting programs or services.

But Botana said each of the four options had implications. For example, he said, if the district rejected the city’s recommendations, it would “probably be seen as uncooperative.”

But if the district offsets a $1 million decrease with its fund balance or federal funds, he said, that would only postpone the problem. Next year, the district is expected to either reduce programs or find a way to reincorporate externally funded programs into the general fund, which would increase the tax rate. Still, most widely promoted Botana using $1 million federal elementary and high schoolol Emergency Relief Fund, part of the CARES Act, to offset the school budget.

The district expects to have about $12 million of the $17 million federal relief fund remaining in August.

But some board members hope the board will approve the school district’s budget as is, eliminating the need to cut the budget.

Figdor reminded council members that they were in a similar situation last year, when the city’s finance committee rejected the school’s budget and asked the district to cut it. But the council ended up approving the budget.

Others agreed that they should wait for the vote of the council to make decisions.

“I just want to let the process wear out,” said board member Adam Burk.

Money should be tight for the city next year.

Mayor Kate Snyder told councilors Monday night that they were going to have to make tough choices – either raise taxes, cut services or both. According to Snyder, the main pressure points on the budget are inflation and general assistance – a state program requiring municipalities to help people who cannot cover the costs of basic necessities.

The state pays 70% of general assistance costs, and the federal government is currently reimbursing the city for emergency shelter expenses, easing a significant portion of the taxpayer burden. But the federal funds will expire in June, leaving town to figure out how to pay for assistance to a record number of people seeking shelter and other services.

The city is considering a $269 million budget that was proposed by interim city manager Danielle West last week. The budget proposes a 5.5% tax increase. The proposed budget, combined with the school board’s $133 million budget, would result in a tax increase of 4.8% or 62 cents per $1,000 of assessment, raising the tax rate to $12.99 at $13.61. That would equate to a $226 tax increase on a $365,000 home.

But as it stands, the city’s budget has a $2 million deficit, which means the city will likely have to either raise taxes, make cuts, or reevaluate its approach to homelessness and housing. emergency, a main factor in the increase in costs.

In other news, there has been an increase in COVID cases in Portland public schools. The district reported 98 cases the week of April 24. The previous week, the district recorded 11 cases districtwide and two weeks before reporting 44. The increase is consistent with broader community and state trends.


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