Supervisors OK school bond referendum

MILFORD – The Caroline County voters will decide on a $25 million school bond referendum in the November election.

The Board of Supervisors unanimously agreed to put the referendum question on the ballot when the panel held its regular meeting Tuesday evening this week.

The supervisors adopted a resolution asking the Caroline County Circuit Court to order a special election to put the question on the ballot. Virginians will vote for candidates for statewide office and the General Assembly in November.

The bond issue, which was sought by the School Board, would finance two school building projects. The bulk of the money would go to expand and renovate Caroline High School, and the remainder would go for improvements to Madison Elementary School. The high school project would cost an estimated $21 million, the elementary school project, $4 million.

Once a bond referendum is approved, the county would have up to eight years to borrow the money. A two-year extension is available in some cases.

Borrowing for the two school projects could cost the county from $43 to $53 million in  principal and interest depending on interest rates and length of terms of the bonds, according to the county’s financial adviser.

“This is all subject to change and most likely will,” Courtney Rogers, senior vice president for Davenport & Company, said after the board meeting.

Voters must first approve the school bond referendum; after that, county officials would decide where and how to borrow the money.

Depending on interest rates and the length of terms of the bonds, the county’s annual debt service payments would range from $1.7 million to $2.1 million.

One cent of the real estate tax rate generates about $250,000 in revenue to the county, noted Supervisor Floyd Thomas.

Annual debt service payments of $2.1 million to finance 20-year bonds, for example, would be the equivalent of more than eights cents on the real estate tax rate. Annual debt service of $1.7 million for 30-year financing would be the equivalent of about 7 cents on the real estate tax rate.

Thomas expressed concern that, if the county issues school bonds and borrows the money, the Board of Supervisors has no control over how the School Board would spend the funds.

“I wasn’t elected to tell the schools how to spend the money,” responded Supervisor Wayne Acors. “They came to us in good faith,” he added, and requested financing for the two building projects.

The high school, built in the 1970s, is over-crowded and needs more classrooms. It also has a leaky roof and outdated wiring that wasn’t designed for today’s computer networks.

In other action, the board voted unanimously to borrow $6.6 million from Bank of America to pay for a new public safety radio system. The loan will be for 12.5 years at an interest rate of 2.53 percent. The county is buying the radio system from Motorola.

The new system is necessary to comply with a federal mandate and to replace the county’s 30-year-old outdated system that has lapses in communication in certain remote parts of the county.

Posted on Thursday, June 13, 2013 at 11:56 am