New school tops the budget

Published 12:00 am Thursday, November 18, 2004

Suffolk News-Herald

About half of the city’s proposed $28 million capital budget for 2005-06 will be used to finish building an 800-student elementary school.

Next year’s capital plan earmarks $12.3 million for public education. All of the funding would complete Creekside Elementary School before its targeted September 2006 opening.

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The new school on Shoulders Hill Road is costing 25 percent- or $3.6 million – more than originally anticipated, largely due to the increasing costs of steel and building supplies, said Christine Ledford, the city’s finance director..

&uot;The escalating costs are the results of differences in time and surging construction

costs,&uot; said School Superintendent Dr. Milton Liverman during Wednesday’s City Council work session. &uot;Everything related to school construction has just skyrocketed.&uot;

City Manager R. Steve Herbert officially presented the proposed 10-year $420.2 million Capital Improvement Plan to council at the session, outlining major expenditures for schools, industrial and economic development, public safety, public utilities and numerous other projects.

Over the next two years, the CIP also calls for building a $4.4 million police administration building in the downtown area. The foundation of the current 12,500-square-foot headquarters adjacent to the municipal building has undergone extensive settling in recent years, causing damage that engineers believe would be cost-prohibitive to repair, Ledford said.

The CIP calls for spending $500,000 on the project in


with another $3.9 million budgeted for construction in 2006-07.

&uot;The cost of repairing the building is about the same per square foot as building a new building,&uot; said Ledford. &uot;The most cost-effective approach is construction of a new building.&uot;

Repairing the current facility doesn’t guarantee the same problems won’t reoccur in the future. Additionally, the growing police administration is already cramped in the current facilities, Ledford added.

Other projects proposed for funding next year include $1.5 million for the renovation of the East Suffolk Recreation Center;

$1 million to extend Prentis Street, from Pine Street to Pitchkettle Road; $1.1 million to build a connector road between Finney Avenue and Clay Street; and $1.2 million to proceed with the Fairgrounds housing plan.

The city is proposing to borrow $18 million annually for the next decade to help fund the projects, Ledford said.

Napoleon Nelson, managing director of Public Financial Management, assured council members the move would not jeopardize the city’s current AA financial rating.

&uot;Your borrowing policies are in line with rating agencies’ perspective on outstanding debt,&uot; said Nelson. &uot;You have a very good rating…and are in sort of rarified company. It’s important to keep those ratings at that level.&uot;

Ninety percent of cities have bond ratings at less than AA, he added.

The proposed annual debt assumption will not cause taxes to go up, Nelson said.

&uot;Increases in assessed value will offset increases in debt service,&uot; he said. &uot;We don’t see that any increases are necessary in taxation for that purpose.&uot;

The council will hold a public hearing on the CIP at its Dec. 15 meeting, with adoption scheduled for Jan. 5.