The Cranbury Board of Education has started to explore the possibility of having a facilities referendum, in a move to examine its options to pay for capital projects.
Board members spent part of their meeting on Aug. 21 with their financial adviser, reviewing the steps involved in going to voters to seek approval to borrow money. They went over everything from when, on the calendar, they are allowed by law to have a referendum, to details for when project plans have to be submitted to the state Department of Education for approval.
Adviser Mary Lyons said referendums are typically funded by a bond sale, with bonds sold on a competitive basis. She said there would be a lot of interest from investors, given the school district has AAA bond rating.
“We’re not worried that you’re not going to get decent bids,” she said.
Officials said the state no longer provides districts with Regular Operating District (ROD) grants for capital projects, so a referendum is their only avenue to get financial support from the state, which provides districts with partial reimbursement of up to 40 percent.
Board members gave no timetable for when they would decide whether to have a referendum, but between now and that decision they will need to identify what they see as their priorities, from the standpoint of capital projects.
The district had its architect provide a “front to back” analysis of the school two years ago and recommend projects that need to be done. Some projects, like resurfacing the tennis courts, are happening now.
“Our job as a board is to, one, prioritize, and, two, then determine how we’re funding those projects, whether through the regular operating budget or whether they would be packaged in a referendum,” Chief School Administrator and Principal Susan L. Genco said during a break in the meeting.
Earlier, board member Evelyn Spann touched on some of the needs the district has, like updating restrooms. She said for security reasons, the school needs “a safer vestibule and a longer entranceway before people come into the building.”
“Those are things that need to happen,” she said, “but as we do that, we need to be smart.”
During the meeting, one possible project that came up was constructing a performing arts center, a stand-alone building separate from the school. Officials have not decided whether to undertake that project, however.
Cranbury school officials are having this conversation as the Princeton Public Schools is looking to hold a $129.6 million referendum in November to pay for building a new school and other projects.
Through the tuition it pays Princeton to send Cranbury residents of high school age to Princeton High School, Cranbury would have to pick up some of the debt service on projects connected to Princeton High School.
Earlier in the meeting, Lyons touched on why a lot of districts in the state are going down the route of having referendums. She said on one hand, school districts are retiring old debt and, on the other hand, there are concerns about rising interest and construction costs.
At the moment, Cranbury is carrying $1.8 million in debt, but it is due to make its last debt payment from the 2003 addition to the Cranbury School in July 2022. One board member said with that schedule in mind, officials have time to “prepare for this bright future.”
“I think Cranbury has a very rich tradition of good financial stewardship,” said board member Lindsay McDowell, chairman of the finance committee. “I think one of the major components of that is planning and thinking out ahead and getting ahead of these things.”