The Los Banos Unified School District will borrow funds to leverage state construction dollars for a new junior high school when the money becomes available.
On Nov. 7, the district’s board of trustees voted 4-2 to issue $7.8 million in bond anticipation notes. Trustees Chase Hurley and Dennis Areias voted against the plan and Trustee John Mueller was absent.
The district payback for the bond anticipation notes will be $29.2 million. District officials rejected a previous proposal for accessing nearly $10 million in funding left over from a $44 million 2008 bond used for the construction of Pacheco High School. That plan carried a $43.5 million payback.
Superintendent Steve Tietjen explained the problem the school district was facing.
“One of the things we’re worried about is developer fee funds are dwindling based on our direct debt repayment,” said Superintendent Steve Tietjen. “We haven’t seen an in-flow yet of dollars from new construction, and we’re worried about the state waffling on whether they’re going to pass a bond for school construction in 2014.”
Built for 900, Los Banos Junior High School has 1,570 students. The district estimates a new junior high school will cost $23 million. Matching funds from the state will be needed to build the facility. Officials are considering using $500,000 from bond anticipation notes on the design of a second junior high. Tietjen said that would allow the district to be placed on the list for construction dollars when state funds become available. In the meantime, a portion of the money from bond anticipation notes can also be applied to the debt service for Mercey Springs Elementary School.
Bond anticipation notes are smaller short-term bonds. The issuing bodies use the bond anticipation notes as short-term financing.
Another solution may be converting an elementary school to a junior high.
“Westside (Union Elementary School) has some facilities that could be used as a junior high. They’re not sufficient so we would have to add to Westside,” Tietjen said. “We’d have to move those kids somewhere, so we’d have to build another elementary site. We could do that for a lot less money.”
Trustee Tommy Jones said the need for new schools is urgent because Los Banos is projected to see sizable population growth in the next few years.
“The population is going to explode,” Jones said. “So if it’s going to explode and we’re not making the decisions to look at housing more students, the problem is going to come right back in our laps.”