AES project has new twist

Published 10:01 pm Friday, July 5, 2019

WINTON – After more than an hour of debate, the Hertford County Board of Commissioners opted to approve a motion that will seek $15 million in state funding to build the new Ahoskie Elementary School.

The twist in the debate was connected to an original plan to add a 465-seat auditorium to that school construction project. The construction plan that included the auditorium (with a projected price tag of nearly $17 million) was turned down by the Commissioners in June of last year. Rather, the majority of the board (in a 3-2 vote) favored the least costly option – a $14.8 million project that will construct a 57,150 square-foot facility across the street from the current Ahoskie Elementary School. The latter has served students since 1959 and has been a topic of serious discussion since 2011 to replace the aging facility.

However, the auditorium topic resurfaced again at the July 1 Commissioners meeting, which prompted the long debate. It was noted on several occasions during the back-and-forth banter among the Commissioners that it did not matter if Hertford County’s application for the $15 million from the state’s Needs-Based Public School Capital Fund was denied, they would still proceed with borrowing $14.8 million to build the school.

At the debate’s outset, Hertford County School Board Chairman David Shields also stated the intent was to build a $14.8 million school.

“If we were to get this 15 million dollar grant, then because of the required three-to-one match, the county would have to come up with five million dollars,” Shields said. “If that was the case, we’ve always said we would like an auditorium, but we know the county doesn’t have an open checkbook, and I agree with that. But if we don’t get this grant money, I don’t want the county to spend $50,000 for an architect to design an auditorium that we can’t afford to build without the grant.”

Shields suggested waiting to see if the county was awarded the grant and then have the architect design the auditorium.

It was noted at this point that the county’s matching grant would be more than enough to add the auditorium to the project.

“It would be awesome for us to build a brand new school and have an auditorium for five million dollars,” exclaimed Commission chairman Ronald Gatling. “If we get the grant then that’s less money we have to spend. Whichever way we go, the bottom line is we need to build this school.”

Hertford County Manager Loria Williams chimed in and suggested that if the auditorium is added it should be an alternate project.

“It’s whether this $15 million is going to increase the scope of the project or this needs-base grant will supplement the $14.8 million we had planned to borrow,” Williams noted. “That’s the determination ya’ll need to make in order for us to move forward. We still have to go to the LGC (Local Government Commission) as to the extent of what we’re borrowing.”

Ted Cole, representing Davenport & Company – a financial advising firm under contract with Hertford County – said the county’s debt affordability analysis was rated “very strong” by S&P, the world’s leading provider of credit ratings. He said if the state grant is denied and the county proceeds with a traditional loan (4% interest for 15 years or 4.5% at 20 years), the annual debt service payment for that construction loan would start in 2021 as high as $1.58 million (depending on the 15-or-20-year payback).

However, Cole pitched another plan if the $15 million state grant was approved.

“Right now you have close to five million dollars of school capital project money that you could use for this required match for the grant and avoid borrowing any money,” he suggested. “If you avoid borrowing money, you do not have to go to the LGC. They only become involved when you plan to borrow money.”

Cole did remind the commissioners that if they accepted the $15 million grant, there’s a stipulation that the county must forego their annual appropriation ($200,000) from the NC Education Lottery for the next five years.

He added that the county should receive notification by early October of whether or not their grant application was approved.

In the meantime, the construction bids for the project are expected to come in during the month of August.

“Those bids are typically held firm for 90 days,” Cole said. “That means by October, when you hear back about the grant, you’ll know for certain how the bids are and you can choose the direction you want to go, with either grant money, local money, loan money or a combination. You, at that time, could add the auditorium to the mix as a potential alternate. I’m not clear on the grant requirements. If it’s not included in your application, I don’t know if you could fund it from the grant money.”

“If we have a 20 million dollar project, 15 million with a grant and five million of county cash, then we have a new school and an auditorium with no loan; that saves our taxpayers millions of dollars in interest,” stated Commissioner Andre Lassiter.

“That’s what we, the administrative staff, are recommending,” said Williams.

Following additional debate, the commissioners came back to her proposal, approving a motion, made by Lassiter, without objection to authorize an application for a needs-based grant for $15 million to include the estimated cost of an auditorium within the scope of the project.

“With this motion, you are not approving any extra funding for anything; you are not approving a different set of plans for the bidding process,” stated Charles “Chuck” Revelle, who serves as legal counsel for the county. “You have already approved what is to be placed up for bids.


About Cal Bryant

Cal Bryant, a 40-year veteran of the newspaper industry, serves as the Editor at Roanoke-Chowan Publications, publishers of the Roanoke-Chowan News-Herald, Gates County Index, and Front Porch Living magazine.

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