BRADENTON — The Manatee County school board Monday approved borrowing $45 million to pay for the construction of three capital outlay projects.
The 3-1 decision came after a tense discussion between four board members on whether to finance the construction of GD Rogers Garden Elementary, Palmetto High’s auditorium and the district’s support staff hub, the Matzke Complex. School Board Chairman Walter Miller was absent, and Board Member Bob Gause voted against the move.
Gause opposed the decision because it could set the stage for the board to violate one of its guidelines of not having a debt that is more than 50 percent of what it can generate from the district’s capital millage rate.
“When you owe a lot more money compared to what you make, most lending institutions will increase interest rates,” he said. “The risks are higher for the people loaning the money so they charge more for you to borrow it.”
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Last year, state lawmakers lowered the capital outlay millage for schools from 2 mils to 1.75 mils to help ease cuts on the operating front. This year, the proposed budgets from both the House and Senate included another millage reduction, to 1.5 mils.
That comes to about $6.3 million less in revenue a year in Manatee, or $31.5 million for five years, Gause said.
There are still projects under the district’s five-year capital plan that the school board has not sought financing for such as Manatee Technical Institute and Manatee High’s Davis Building. The current five-year capital plan does not take into consideration the millage reductions.
“The decision tonight puts us in a position of having to potentially vote for exceeding that (school board guideline) limit,” Gause said. “One option is to reduce scope or postpone the project until you have a better handle on what your finances are.”
In the worst-case scenario, district administrators say they could defer maintenance work to help pay off the debt.
“We have been so conservative in Manatee, with our debt numbers,” said Superintendent Tim McGonegal.
Other districts have owed more than the 50 percent level of millage revenues, he said.
Board members Monday also voted 3-1 to go ahead with the Davis Building project, and to authorize fencing and repair work at DeSoto Square mall’s parking lot. The district intended to park half its school bus fleet there while the Matzke Complex, where buses are usually parked, goes under construction.