Officials make case on
need for school funds
By vincent todaro
Staff Writer
EAST BRUNSWICK — The Board of Education has made its case to the Township Council regarding a $2.5 million interlocal agreement to pay for items needed at Churchill Junior High School.
Board President Michael Baker, Vice President Charles King and Superintendent of Schools Jamie P. Savedoff addressed the council at its meeting Monday night and explained why the board wants to use the township’s financing capabilities to help complete the ongoing work at Churchill.
School district officials hope to enter into an interlocal agreement with the township so that the board can take advantage of the township’s 1.4 percent interest rate on bonds. Without that, it would have to pursue a lease purchase agreement that would mean paying an interest rate of more than 3 percent.
Baker said the interlocal agreement would save the district about $35,000 a year in interest.
The agreement would have to be approved by the council.
In November, Mayor William Neary and council members said they wanted an explanation from the board as to why it wanted to use township services to bond for $2.5 million.
The board had initially sought $2.9 million through the interlocal agreement. The additional $400,000 would have paid for the purchase of new technology to be used district-wide. That expenditure — which was supported by the board’s majority but opposed by King and board member Michael Danatos — was later questioned by Neary and members of the council, who argued that the board agreed to cut money from the technology line item after its budget was defeated by voters in April.
The $400,000 has subsequently been dropped from the request.
However, council members said they wanted an explanation from the board regarding the interlocal agreement before they could approve it.
The $2.5 million being sought would include $900,000 for technology improvements at Churchill and $1.6 million for equipment, furniture and carpeting at the school.
At Monday’s meeting, Baker said the district simply ran short of money for the Churchill project and officials have known for months that it would need more than the $26.8 million originally approved by voters in a 2000 referendum. That referendum enabled improvements at the school’s two existing buildings and the construction of a new core facility between them. The project is expected to be completed by the start of the 2003-04 school year.
King said the project’s design plans were done in March 2000 and that the state offered to pay about $10.7 million of the costs. Voters approved that referendum in the fall of that year, and the district quickly moved to finalize the design plans.
However, by the time the state approved the plans in 2001, construction bids were escalating rapidly.
After the state announced it would grant about 40 percent of costs for some school projects, many more districts began planning them, Baker said. That led to more work for construction contractors, who responded by greatly increasing their prices.
The first bid the district received for Churchill came in at about $5.8 million more than the amount approved by voters, King said. The board responded by cutting expenses from the project and going out to bid again.
A second bid received in December 2001 was still about $3.4 million more than the approved cost, he said.
Officials then negotiated with contractors and brought the price down by about $1 million, King said.
They went to the district’s bonding attorney to ask what could be done and were told that, because the items contained in the additional $2.5 million were "moving" items — and not part of the actual construction — the district could qualify to buy them through an interlocal agreement. That would enable the district to spend more than the $26.8 million approved by voters.
The board has known since January 2002 it needed to find another $2.5 million, King said.
Councilman Jeffrey Simon asked if the costs, which are for items such as furniture and computers, could be deferred because of the suffering economy.
King said that would be impractical because the school needs the items immediately. He also said the new cafetorium would be used not only by students, but also by the community at large for various events.
He noted that none of the money would be used for district-wide technology, as was dropped from the request.
"This is for the completion of Churchill, period," he said. "There’s nothing else in here."
Councilwoman Meryle Asaro called the board on its attempt to get the $400,000 back despite it being cut last spring, saying the board’s initial request showed an attempt to get the money back into its budget.
"This does beg the question of communication," she said.
Asaro said the township is being asked to manage its money more tightly, and that the board should try to do the same. She also asked if the board could delay some of the costs for Churchill.
King said that as construction moves along, the district may find some areas where savings could be made. Whatever portion of the $2.5 million that is not spent to finish the school "goes back to pay debt immediately," he said.
No date was set for a vote on the interlocal agreement.

