Financing Options for Park City School Expansions Could Include Voter Referendum
The Park City School District is considering various financing options to pay for the estimated $100 to $140 million in school facility expansions set forth in its master plan going forward.
The Park City School District Master Plan has been more than two years in the making. As KPCW reports, the priorities are to move the 9th grade to Park City High School, create a 6th through 8th grade Ecker Hill Middle School, and expand all four elementary schools to include space for universal Pre-K. It also includes wrap-around services in two of the elementary schools.
Park City School Board member Andrew Caplan said they are working with the consultant to find a way to phase in the projects but cause as little disruption as possible for students. He said a general obligation bond has the lowest rates of about 1.65%. It is commonly used in Utah to finance school capital projects, considered one of the least expensive and is put to a citizen vote.
The school board must decide to run a voter bond referendum 45 days before election day on Nov. 2.
“Kind of the lowest way that we can finance that, but right now, these revenue bonds, which are bonds backed by the actual buildings, are only about point three of a percent higher to 1.9%,” he said. “The possibility of bank loans are also in line with that somewhere around that that 1.9%. And those are market rates."
GO bonds are contingent on voter approval, so Caplan said the earliest the school district could access funds would be the spring of 2022. The lease revenue bonds and bank loans are not voter-approved but are more flexible.
"We've been approached by (Zions Bank) public finance, and they've been very helpful and tried to help us unlock value from public land that we own,” he said. “We're also talking to them and some other local Utah-based foundations that have an interest in helping support our community through social impact projects."
The school district owns property in the Bear Hollow neighborhood, but there are zoning limitations. While nothing is off the table, Caplan said they consider it more of a land bank property investment. Another parcel owned by the school district in the Silver Summit neighborhood has similar limitations to Bear Hollow. The most recent acquisition in the Trailside area could become a housing investment for the school district.
"The parcel that we bought over by Trailside, you know, I think we're happy land-banking it if we need to,” he said. “There's obviously quite a bit of expansion happening towards that end of the district, in terms of housing and things like that, so I think that's a good strategic purchase for us and at a very good price, but we would also consider looking at that and potentially putting some employee housing on it."
Caplan said attracting and retaining district employees is a priority for the board and providing employee housing would help to achieve that goal.
He is sure there will be a bond issuance, but they haven't decided if it will be for the entire cost of all the projects in the plan.
“We have to figure out relatively quickly in the next couple of months what our other options are if we're not going to do the entire thing on a bond,” Caplan said. “There's possibilities that they'll do a bond for one or two of the project and then maybe try to finance the early childhood in a different fashion. So maybe we get some foundation money maybe we run a capital campaign and use some of our reserves for that."
Caplan said the community wants green buildings, but the costs are estimated to be about $75 per square foot. The district hired consultancy firm MOCA Systems, Inc. to help manage the bond and building processes. They estimate the costs could run from $30 million to $40 million.
The school board meets at 4 p.m. on Tuesday, April 20, at the Park City School District office at 2700 Kearns Blvd.