I nitiatives that could help to reduce energy costs and foot the bill for capital improvements in the Freehold Regional High School District are being investigated by district administrators.
FRHSD Board of Education member Michael Messinger said the finance committee, which he chairs, has examined the possibility of solar energy and other energy conservation measures in the budget process and in regard to capital projects planning.
Business Administrator Sean Boyce gave a presentation about capital improvements using the Energy Savings Improvement Program (ESIP) during the board’s Aug. 22 meeting.
Boyce said the district’s facilities must be maintained. In order to fund the maintenance work and new capital improvements, money can come from the district’s annual operating budget, from a special referendum that would authorize the issuance of bonds (i.e., borrowing money), or from other financing strategies.
Under the proposal Boyce brought to the board, other financing strategies are being reviewed.
Earlier this year when the board was organizing its operating budget for the 2011- 12 school year, Boyce said funding for capital improvements was removed from the budget in order to get a zero increase in the tax levy due to the uncertainty of the economy and the district’s revenues.
At the same time, officials determined that seeking voter approval to borrow money for capital improvements was not an appropriate avenue at this point for the district’s eight sending municipalities.
With one option — other financing strategies — remaining on the table to fund maintenance work and capital projects, Boyce began looking at the ESIP, which would not be separate from the annual operating budget.
Administrators will be examining ways to reduce the district’s energy costs. Through the ESIP, money that previously would have paid for energy costs would be repurposed for capital projects. This would be a tax-neutral initiative, according to the business administrator.
The FRHSD has already completed a preliminary energy audit, and some of the suggestions that were made in the audit have been completed. That was the first step in the process of the ESIP. The next step will be to issue a request for proposals (RFP) for an energy service company.
There are 20 qualified firms that will be allowed to bid on a contract with the district. Following that step, an energy savings plan will be developed.
As a plan for projects unfolds, the district would pay off debt through the savings it realizes through the ESIP.
The savings plan would serve as a model to determine how best to pay for potential capital improvement items. Boyce said options available to the district would include refunding bonds, capital leases or power purchase agreements.
Boyce said he believes the ESIP is the right move for the district. He said he will issue an RFP for an energy service company. There is no cost, obligation or risk to the district to issue an RFP and gauge companies’ interest in the matter, according to Boyce.