The Boothbay Harbor Community School District Board of Trustees decided Jan. 2 to move forward with heating and ventilation work at Boothbay Region Elementary School projected to cost $3.5-$4 million.

Honeywell, the company the CSD is in contract with for system maintenance, would not be doing the financing, but would be able to guide the CSD and help with financing applications, said Honeywell’s Jim Lucy.

Yearly payments, projected to run about as much as current debt payments, are already in the budget as past debts will soon be paid off, said Lucy. He outlined three combinations to fund the initial work: Cash, lease purchase or bond.

“You can have any combination of cash and any kind of financing so you don't have to borrow it all,” Lucy said. He added, most projects are 100 percent financed, but the CSD could put cash down. With costs of commercial construction increasing about five percent every year, and the potential for interest to rise, Lucy said acting sooner would avoid larger costs.

Most school districts will opt for a lease purchase agreement, but Lucy said the CSD’s charter allows the trustees the unique flexibility to bond without voter approval.

“I think that's the route we recommend you strongly consider … In this case, you have the ability for the betterment of the taxpayers to go after the best, lowest cost structure which is through bonding.”

The next step would be reaching out to attorneys at Drummond Woodsum for help with the application process, said Lucy. The attorneys would likely come back with paperwork for the trustees to authorize before the application's mid-February deadline.

In a separate interview, Laser said he had an attorney review the charter's language about the board’s power to apply for a bond without voter approval.

“Bottom line is the charter doesn't give the Trustees carte blanche to go out for bonds,” Laser said in an email. “The charter does have a process that includes notifying the town managers, publishing it in the newspapers, etc.”

“We've got a lot of other things to go with it, so it's just deciding on how we're going to handle everything,” Chair Richard Hallinan said at the meeting.

Trustee Ronnie Campbell commented members might consider picking a number they are comfortable with, but noted his concern for future projects.

“If you do the projects the architect laid out for us, which is roughly $3.5 million … that would be another bond,” said Laser. “If you apply for a bond, you've obligated the town of Boothbay and the town of Boothbay Harbor for the next 20 years for this loan … Then, to fix these places up, you're looking at another $4-$5 million and that's another $250,000-$260,000 per year.”

Trustee Kevin Anthony noted, among the three options – close, build or fix – it has been abundantly clear community members have struck down the idea of closing the schools to transport students off the peninsula or to build a new school elsewhere. Anthony said he supports the notion of pursuing a bond due to popular opinion to keep the schools open, but he still has reservations about the board’s approach to financing the projects.

Hallinan said neither the work nor the potential costs are news to the towns or the public, and the work is needed to keep the buildings functioning properly for students' safety and well-being.

"We did the heating system in the high school, other work, we did it this way and never had a problem because it was needed,” said Hallinan. “… I think we all agree that between the interest rates and the cost increase every year, it's cheaper to do it now. The only other question is what are we going to feel comfortable with for a bond?”

The board decided if it is going to pursue a bond to cover the costs of HVAC work – projected to be $3.8 to $4.5 million including other high priority projects if added – it would want to approve a higher number, $5 million, in case projections fall short.

Hallinan's motion to approve fixing the heating and ventilation system included no language to apply for a $5 million bond. The board, short of trustee Ashlee Lowery, voted unanimously in favor.

Other business

The board nominated Steve Lorrain for representative to the Boothbay Region Education Foundation and Troy Lewis for representative to the Vision Committee.

Trustees meet next at 5:15 p.m. Wednesday, Feb. 6 in the Boothbay Region High School library.