Spreading $72 Million Around

Guilford County Schools shows every sign of having abandoned its plan to build a $72 million high school in western Guilford County – and its administrators spent much the Guilford County Board of Education's Saturday, Sept. 22 retreat trying to sell the school board on a plan that would spend the equivalent amount of money fixing existing schools and bringing them up to a baseline standard of equipment.

The plan is part of a major fight brewing on the Guilford County school board over the millions of dollars the school board will have left over from the almost $1 billion in school bonds approved by Guilford County voters since 2002.

At the retreat, the school board voted to spend $15 million of what will almost certainly be a much larger amount of money left over after the school board is done with the projects promised to voters in 2008. The school board instructed Guilford County Schools Facilities Department administrators to come back with a recommendation on how to spend the money.

The administrators, for their part, came up with a 29-project priority list to upgrade, repair and equip schools to a common baseline that would cost $75 million, just a little more than the amount budgeted for the high school, and the school board is going to have millions more left over – "a pretty significant amount," according to school board Chairman Alan Duncan.

The $75 million plan includes some one-off repair jobs that aren't related to the rest of the plan, such as repairing the historic 1930s rock gyms at Allen Jay Middle School in High Point and Summerfield Elementary School, and paving a parking lot next to the Grimsley High School football stadium that is deteriorating quickly because it is used as a transportation hub.

Most of the $75 million, however, would be used to do common repairs and upgrades for large groups of schools – $19 million for heating, ventilation and air-conditioning (HVAC) improvements, $11 million for roofing, $8 million for windows and doors, $7 million for audio-video equipment and computers, $6 million for paving, $1.9 million for a voice over internet protocol (VoIP) communications system and the like.

At the retreat, Guilford County Schools gave the most detailed accounting to date of what has, and hasn't, been spent of the $200 million in school bonds approved by voters in 2000, the $300 million approved in 2003 and the $457 million approved in 2008 – which adds up to $957 million in bond authority.

The school board has also received money from the North Carolina Public School Building Capital Fund, state lottery funds, the Guilford County Board of Commissioners, and insurance collected after Eastern Guilford High School burned down in 2006.

According to the spreadsheet given to the school board members, there are 57 projects that haven't been closed out from the three rounds of bonds, and $756 million has been allocated to those projects from all sources. Of that money, $500 million has been spent and $39 million has been contracted for, but not spent. That's only $539 million explained.

According to Guilford County Schools, that leaves $216 million from the 57 projects "available for pending items or transfers." That includes two categories of money. The first is money the school board has on hand but will spend on projects that are still open. The second is leftover money.

According to Guilford County Cash and Debt Manager Clay Hicks, Guilford County Schools has $92 million in cash on hand for the construction projects and $130 million in authorized, but unsold bonds, or $221 million. Hicks said the difference between that and the $216 million listed by Guilford County Schools probably results from the fact that the school system hasn't checked with the county to see how much money it has left since Sept. 7, 2011.

So Guilford County Schools has $221 million, if all the bonds voters approved are sold. Hicks said he can't say how much of that money will be left over after all construction projects are finished, because, once bond money has been transferred to the school board for projects, the school board keeps track of whether projects are under or over budget.

The biggest question mark in the construction program is the $68.7 million the school board has not spent of the $72 million allocated to the airport area high school and land for a future middle school on the same property. The school board has been unsuccessful in finding 120 acres of land in western Guilford County for the two schools, so that $68.7 million has not been spent – and may never be spent, if school board member Ed Price has his way.

Price has questioned the need for the airport area high school, saying the money should be spent on fixing decayed county schools. He repeated the argument at the retreat, saying the school board needs to decide whether or not it needs a $72 million high school.

The spreadsheet provided to the school board was, in a way, useless because it didn't clearly separate projects that have substantial spending left from ones that are finished. A school in the first category is the $25 million southeast area elementary school, which was delayed for months because the school board couldn't find land that would satisfy residents of southeast Guilford County. Guilford County Schools has spent less than $2 million on the school, and has almost $23 million left to spend on it.

Guilford County Schools identified 10 projects that the Facilities Department is willing to close out. Guilford County Schools Executive Director of Facilities Management Robert Melton provided the amount left over from the 10 projects: $26.5 million, although school board members disputed that amount.

Duncan said, "This is opening up a hornet's nest."

It is, too. School board members have different theories about how leftover construction money should be spent. Often it is on schools in their districts. There is also a major philosophical rift on the board over whether money allocated to a school should be spent on that school, even if the original project is finished, or put in a big pile of money for the school board to spend later.

Duncan belongs to the "big pile of money" school. He told the other school board members that he gets looks when he says the money belongs to the school system, not the school. He said, "It's important that we think of it that way as well."

School board member Kris Cooke said there are "different ideologies" on the school board on the issue. She told Duncan, "We know you've said it, but that doesn't mean we all agree on it."

The school board then began dickering over how much of the $26.5 million to spend now, and how much to save for projects that may crop up.

That's where the Guilford County Schools $75 "priority list," or spending program, comes in. The $75 million figure can't be random. The school board recently came up with a master plan that calls for $1.2 billion in spending on school construction over the next decade, including new schools, replacement schools, school additions and, the biggest number, $937 million in school renovations.

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The Facilities Department could have allocated whatever is left over of the $221 million to building a new school, building several school additions or whatever it wanted to. It didn't. Instead, it proposed spending $75 million on 200 repair-and-upgrade projects in 12 categories at 80 schools scattered throughout the school system.

School Superintendent Mo Green used the retreat to present his 2012 four-year strategic plan for the school system, the follow-up to his previous four-year plan. Both plans include "clear baseline and equitable standards" – making sure that all Guilford County public schools meet at least a common baseline of facilities, technology, media materials, teachers and activities.

Teachers, media materials and activities don't count as capital projects, but most of the $75 million in spending proposed by Guilford County Schools administrators falls within Green's baseline equity plan. Two categories of projects – audio-video upgrades and the VoIP system – within the $75 million plan are specifically labeled as baseline projects, but many others fit within the baseline-equity plan.

What seems to be happening is that Green plans to use leftover money from the construction programs to kick-start his baseline-equity plan by roofing and repairing schools not on the project lists and then equipping schools with modern equipment that don't have it now.

Administrators then packaged the plan to sell to the school board the same way the school board sells school bond referendums to taxpayers: by splitting the projects up between different regions.

The giveaway in the presentation was that the administrators broke down the $75 million spending plan not only by priority, spending category and school system region, but by how much of the spending would be in the district of each school board member. That's a political sales job.

Of the $75 million in spending, $6.5 million would be in District 1, represented by Carlvena Foster; $13.7 million would be in District 2, represented by Ed Price; $8.3 million would be in District 3, represented by Darlene Garrett; $6.2 million would be in District 4, represented by Alan Duncan; $7.6 would be in District 5, now represented by Paul Daniels but which will be represented starting in December by Linda Welborn, because Daniels has announced he is not running for reelection; $6.4 million would be in District 6, represented by Jeff Belton; $5.9 million would be in District 7, represented by Kris Cooke; $10.5 would be in District 8, represented by Deena Hayes; $8.4 would be in District 9, represented by Amos Quick; and $1.9 million would be in administration facilities.

That distribution manages to spread the wealth among the districts of all the school board members while providing more in poorer districts.

It doesn't make much sense for Guilford County Schools administrators to plan $75 million in spending out of the $221 million and still build the $72 million airport area high school, because there are too many big-ticket school projects left for which much of the money has not been spent.

In addition to the $72 million for the high school, there is $20 million that may need to be spent for McNair Elementary School, $22 million left for the southeast area elementary school, $11 million for Allen Jay Middle School, $11 million left for the Falkener-Hairston campus autism wing, and $11 million for Southeast High School. That's more than $140 million left in construction spending for the airport area high school and other large projects – plus millions more left in the smaller projects the Facilities Department is not yet willing to close out.

It might be technically possible for the school board to spend the $75 million recommended by the Facilities Department and also build the airport area high school. That would be $215 million in spending – but wouldn't account for remaining spending on small projects, cost overruns on the airport area high school or the other remaining big projects. It would also leave the school board with little if any leftover money, something the school board hates.

It also doesn't allow for a possible fight with the county commissioners over issuing the remaining $130 million in bonds, including bonds to pay for the airport area high school, if the school board hasn't even been able to find land for that school.

The biggest indicator that administrators want the $75 million in proposed spending to come mostly from the airport area high school money is that, by dividing the spending up among all nine districts, it has created instant constituencies for its spending plan.

The second-biggest problem with the airport area high school (other than a lack of land) has always been that it has no constituency. The high school was planned to absorb enrollment growth at Northwest, Western and Southwest Guilford high schools, as predicted several years ago when Guilford County Schools was growing by 1,000 or more students a year. The school system's enrollment is now almost flat. In the seemingly endless series of public meetings the school board has held on the construction program, it's hard to remember anyone standing up and supporting the airport area high school.

The vote to spend the $15 million, on a motion by Price, was 7 to 2, with Cooke and Quick casting the two no votes.

Cooke said she and Quick voted against Price's motion because it would spend to little, not too much.

"What I voted against was that we only said we were only going to spend $15 million of what was closed out," Cooke said later. "Amos and I voted against it because I think we have more in there we could go ahead and use. I probably would have gone to 18 or 20 million."

The school board instructed the Facilities Department to come back at a regular school board meeting with a smaller list of projects on which to spend the $15 million amount decided by the vote on Price's motion.