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Facilities Master Plan Q&A Funding

IN LAST WEEK’S COLUMN, THERE WAS AN ARTICLE INFORMING PATRONS OF THE PUBLIC FORUM ON THE BOND ELECTION SCHEDULED FOR MONDAY, JUNE 23. THIS PROJECT INCLUDES ADDING ADDITIONAL CLASSROOMS AND A MULIPURPOSE ROOM TO THE SOUTH SIDE OF OUR FACILITY. THE SOUTH WING WILL HOUSE THE PK-6 STUDENTS. THE CURRENT MIDDLE SCHOOL ON THE NORTH SIDE OF THE BUILDING WILL HOUSE OUR 7-12 CLASSROOMS. THERE WILL BE A COMMONS AREA ADDED FOR THE STUDENTS. AN ADMINISTRATIVE OFFICE WILL BE ADDED TO THE SOUTH AND NORTH END OF THE BUILDING. THESE TWO AREAS WILL BE SECURE ENTRANCES AND VISITORS WILL ENTER THE BUILDING ONCE THEY HAVE SIGNED IN. ALL OTHER DOORS WILL BE LOCKED DURING THE SCHOOL DAY. THE AG SHOP ROOM WILL EXTEND OUT TO THE SAME LENGTH AS THE ALLEY BETWEEN THE SCHOOL AND THE POOL. THE SCIENCE LABS WILL REMODLED.

WITHIN THE ARTICLE, I STATED THERE WOULD BE FUTURE ARTICLES ADDRESSING QUESTIONS ASKED DURING AND AFTER OUR PREVIOUS BOND ELECTION. BY DOING SO, PATRONS WILL HAVE THE NECESSARY BACKGROUND INFORMATION TO MAKE AN INFORMED DECISION WHEN THEY GO TO THE POLLS ON TUESDAY, AUGUST 12.

WILL THE DISTRICT CONTRIBUTE ANY DOLLARS TO THIS PROJECT?

YES, THE DISTRICT WILL BE CONTRIBUTING $1,146,586 TOWARDS THE BUILDING PROJECT. THIS CONTRIBUTION WILL COMES FROM OIL AND GAS GROSS PRODUCTION TAX REVENUE THE DISTRICT RECEIVES.

WHAT WILL BE THE AMOUNT BONDED ON AUGUST 12?

THE AMOUNT TO BE BONDED ON AUGUST 12 IS $12,960,000. THIS BOND WOULD BE OVER A 20 YEAR PERIOD OF TIME.

DOES THE SCHOOL DISTRICT QUALIFY FOR THE STATE LOAN THROUGH THE BANK OF NORTH DAKOTA?

YES, THE DISTRICT STILL QUALIFIES FOR A STATE LOAN. THE DISTRICT HAS BEEN APPROVED FOR A $10,000,000 LOAN AT A FIXED INTEREST RATE OF 1.41%. THIS LOAN IS OVER A 20 YEAR PERIOD OF TIME. OF THIS $10,000,000, $2,000,000 WOULD BE REPAID BY THE GROSS PRODUCTION TAX REVENUE THE DISTRICT RECIEVES FROM OIL AND GAS PRODUCTION. THE REMAINING $8,000,000 WOULD BE BONDED. THE DISTRICT WOULD BOND AN ADDITIONAL $4,960,000 AT AN ESTIMATED INTEREST RATE OF 2.95%. IF THE VOTE IS DEFEATED, THE DISTRICT WOULD NO LONGER BE ELIGIBLE FOR THE $10,000,000 LOAN AND THESE FUNDS WILL GO TO ANOTHER SCHOOL DISTRICT.

ARE ANY OTHER STATE FUNDS AND/OR GRANTS AVAILABLE THROUGH THE STATE TO HELP OFFSET THE COST?

NO, THERE ARE NOT ANY OTHER STATE FUNDS OR GRANTS AVAILABLE THROUGH THE STATE TO OFFSET THE COST OF THE BUILDING PROJECT AT THIS TIME. TWO FUNDS THAT HAVE RECENTLY RECEIVED SOME ATTENTION ARE THE LEGACY FUND AND THE COMMON SCHOOL TRUST FUND. CURRENTLY, 30% OF OIL REVENUE IS PLACED INTO THE LEGACY FUND. THESE FUNDS CANNOT BE USED UNTIL 2017 AND ONLY 15% CAN BE USED IF 2/3 OF BOTH HOUSES OF LEGISLATURE APPROVE HOW THIS MONEY WILL BE SPENT.

THE COMMON SCHOOL TRUST FUND WAS STARTED IN 1889 WHEN TWO SECTIONS ON LAND IN EACH TOWNSHIP WERE GIVEN TO THE STATE. THE INCOME GENERATED FROM THIS LAND IS USED TO SUPPORT K-12 SCHOOLS. IN DECEMBER 2013, THERE WAS AN ARTICLE IN THE MINOT DAILY NEWS BY LANCE GAEBE, THE ND LAND COMMISSIONER. HE EXPLAINED THE FUNDS FROM THE COMMON SCHOOL TRUST FUND COULD NOT BE USED FOR SCHOOL CONSTRUCTION. THE DISTRIBUTION OF THESE FUNDS IS A CONSTITUTIONAL FORMULA AND THEREFORE CANNOT BE CHANGED BY LEGISLATURE. I DID VISIT WITH ROBERT MARTHALLER, ASSISTANT STATE SUPERINTENDENT, REGARDING THIS FUND. MR. MARTHALLER STATED THERE IS NOT AN APPLICATION PROCESS TO ACCESS MONEY FROM THE COMMON SCHOOL TRUST FUND FOR MAINTENANCE OR CONSTRUCTION OF A SCHOOL BUILDING.

CAN A CITY SALES TAX BE USED TO HELP FUND THIS PROJECT?

NO, A CITY SALES TAX CANNOT BE USED TO FUND A SCHOOL BUILDING PROJECT. I CALLED AND VISITED WITH JERRY HJELMSTAD, ATTORNEY FOR THE LEAGUE OF CITIES. IN 2006 OR 2007, THE CITY OF JAMESTOWN APPROVED A ONE PERCENT CITY SALES TAX TO HELP WITH THE CONSTRUCTION OF A NEW SCHOOL. IN THE NEXT LEGISLATIVE SESSION, THERE WAS A CHANGE IN THE CENTURY CODE STATING A CITY SALES TAX CANNOT BE USED TO PRIMARILY BENEFIT THE CONSTRUCTION OF A NEW BUILDING AFTER APRIL OF 2007. THIS CAN BE FOUND IN CENTURY CODE 40-05.1-06.1.

AT THIS TIME, THE ONLY WAY SCHOOLS ARE ABLE TO FUND IS THROUGH PROPERTY TAX AND THE LOW INTEREST LOAN THROUGH THE BANK OF NORTH DAKOTA. AT THIS TIME, THIS IS DETERMINED LEGISLATIVELY. IF GRANTS BECOME AVAILABLE IN THE FUTURE, THE DISTRICT WILL APPLY.