001March 18th, 2025. It's 5:01. And we'll we'll begin by indicating who's here. Kim, will you go first? Kim Chandler, Chris Win, Karen Wender, Clark Nelson, Julie Jackson, Todd Hopper, Ben Worsley, Nicole McDerman. All right, we do have um some consent items. First of all, we have a p purchases that we have listed. Um, we've had these for a few days, been able to ask questions. If there are no further questions, I will entertain a motion. I move we accept the consent agenda. I'll second. Right. We have a motion and a second to accept the consent agenda. Are there any further discussion on this? All in favor, please say I. I. I. Any opposed? Motion carries. We then next have an administrative appointment. Again, this is something we've had for a few days. Um, there's no
002further questions. I will entertain a motion. I move that we accept the administrative appointment. Second. All right. We have a motion and a second to approve the administrative appointment. Are there any further discussion on this? All in favor, please say I. I. I. Any opposed? All right. We're going to turn the time over. Yeah. I'm going and I'll turn the time over to Chief of Staff Garden to introduce this appointment. Thank you so much. Uh Madame President, uh Board of Education and Superintendent, I appreciate the opportunity to um talk to you today about our new director of organizational effectiveness, Dr. Joan Bramble. Dr. Joan Bramble um most recently has been our data guru um over assessment and and really she does an amazing job of fishing and then giving out the fish in a way
003that is very palatable by those that need to eat the fish. She does an amazing job of getting uh that information out to people and they have just loved it and it has changed the conversations at the school level and we are excited that she's going to move in to this role um and help um improve our title one schools as well as all schools. We're excited by uh the prospects of having Joan be with us. Joan, if you could uh introduce who's with you. Sure. My husband and appreciate all the Thank you so much. [Applause] Thank you. We are thrilled. I think I know Karen um has some intimate knowledge about Joan and how well she works in schools and with kids and the data that she produces and um we're super excited for
004the work that she will continue to do in that position and and what she because she is incredibly smart and capable in that. So I had an opportunity to work with Joan in a title one school when I was on the PTA and so um she she's going to be amazing. I saw her name come through and I was like, "Oh, good job, Joan. I know she's going to be great wherever her feet land." Thank you. All right, we are going to go ahead and move on to the main part of this meeting. Um, we are going to begin by talking about capital projects. And this is something that has been on our mind. And so we've asked Todd and Don to put their heads together and kind of help us out as we've come
005to figure out this mess, right? The the what we were shouldn't I shouldn't say mess or what has what we've been things have not gone as planned. Let's say that. So we're excited to to see what we have in store. Thank you very much. uh Todd and I uh have have put this together in what we're hoping is an understandable format. Um and and let's let's kind of give the history on it as uh board president McDermott uh coined it. It's been a mess, I believe was the terminology. She and she did not say hot mess, but it is it is without question a challenging roll out uh of comprehensive remodels, new builds, building replacements, etc. And it all has hinged upon uh recent history of a very uh aggressive construction market, cost escalations and
006other economic factors that were uh beyond the control of the district. And so our response at the time uh as we saw buildings increasing in cost at 10 to 15 to 18% per year virtually doubling uh during the first few years of the roll out in cost. Um, we did what what most folks would do and we uh constrained our our our our buying of that and we created delays and uh most of the delays were in the 7 to9year period that allowed us to complete a couple of large projects. We're nearing the end of that and then that opens up cash flow. And so what what we'll present uh tonight are concepts that continue the pay as you go model. And we put that in quotes because that was just a term that was
007developed as we went out to the bond and met with the public in 2017. And so uh we we'll talk about a pay as you go model. We'll talk about another option which is a financing mechanism uh lease revenue bonds. It's not a general obligation bond, but a a means of of financing getting a mortgage to move forward. And we've we've tried to look uh right now at the early projects that are next, a West Kerns Elementary, a Taylorville High Edition improvements, and comprehensive remodels at Calvin Smith, Plymouth, Plymouth, and Moss. We found it best to to look to a degree at how those concepts then impact the remainder of the deployment of remodels and new builds. Uh just a quick chart is attempting to show what uh the new revenue projections say about our
008original delay concept. Tried to be simple. green. Green is go. Green advances something from uh the punt that we had to make in 2019. Yellow keeps it virtually equal and then the red are uh closed schools that have happened through the boundary and closure process over the last 5 years. And so we identify those as you see here. uh we do have some advancement potential and we we although the majority are still respecting that 7 to9year delay in cash flows. Do you want to flip it to the next? Then I had the opportunity to take a look at what would a lease revenue bond do. So if we were to try to accelerate revenues to move projects forward, that's what we then have in these next two columns. Uh the first column that you see
009with the red and green is as Don described uh with the yellow representing the dates don't change the green advance and the red are the capital projects that we wouldn't do with closed schools. So that baseline or the the new baseline as I call it is basically what Don described except in the outside years he and I have a little difference of opinion on what revenues are available at the end of the scale as as opposed to the beginning of the scale and that's fine. Uh shouldn't be a problem. U take you to the next column where it says LRB 5 years. So, this says what what projects would move forward not advance uh with about $114 million bond issuance. And as you go down that column there, uh you'll see that a lot of
010it stays the same. The next column has the lighter green and the lighter red colors. This are these this is what would change if you did do a lease revenue bond on a five-year issuance. You'll have four schools that would advance in their remodels and you'd have four schools that would actually be delayed further in their remodels and uh one of the rebuilds would be delayed. So, in this sense, a lease revenue bond on a five-year bond issuance doesn't make a lot of sense. We'll pay about $16 million in interest and not really move the needle. Well, couple go up, couple go back, and we're about in the same place. If we go to the next scenario, thanks. We have a 10-year bond scenario. Same idea. That first column is if we did nothing other
011than uh adjust for revenues. The next column is the LRB 10 years. Again, a number of projects do move forward. In this case, we would see about six projects would move forward in remodels and only one uh remodel would lose would step back in time. And we would pick up one rebuild and the rebuild would be Kern's junior high. So on this one, when we get down to the bottom line, we look at it and say, well, for about a $30 million interest payment, we can move Karna's junior high forward, and everything else is about the same. So, we almost double the cost, if you will, of a school rebuild. Not quite double, but a good portion of it. Uh, in issuing a bond. Uh, again, not a very attractive scenario. The last scenario, I
012was asked to say, "What can you do, Todd, to to make up for the seven to nyear delay? How much can you push forward?" And we would do that with a lease revenue bond. Now, there's a a challenge with the lease revenue bond in that we only can bond up to $200 million every three years. So, there's only $200 million available to try to advance everything forward through this process. And we have about $500 million in rebuilds and another $400 million in remodels for the balance of phase one. So there so even trying to push it forward it's not enough money to bring everything forward uh because of that statutory constraint. But if we were to do as much as we could in this one we would have about six remodels move forward um we
013would have three eight eight remodels sorry eight remodels. I got to get better glasses. Eight remodels. Uh three rebuilds would move forward. So, still the Karns, but then we pick up Arcadia and we pick up Academy Park and uh we then have two rebuilds that would be delayed even further. So, on this model, we we do have a lot more movement, but it'll cost us about 40 $41 million in interest payments to get that change in the schedule. Um, so the the bonding scenarios don't make a whole lot of sense, at least if we're trying to do a lease revenue bond. We can talk about geo bonds in another discussion, but the lease revenue doesn't seem to lend itself because of the limitations in statute and the cost that a lease revenue bond would incur.
014Oh, I guess I should I'm going to jump on here real quick now that I see the pros and the cons. Um, also if you take a look on the schedule of those projects that move forward, most of those get pushed into the into the 2027 school year, about six projects, almost seven projects. There are other constraints other than finances that make that almost impossible to do to to manage that many projects in one year. And that's why we have the next slide to talk about the pros and cons is it's just a lift that we can't do. So there there are some opportunities that come about when uh you look at lease revenue bonds. You're compressing the construction timeline as Todd highlighted. Again, really focusing on that uh that third option that Todd's highlighted.
015And to a degree, we limit the uncertainty of inflation because we're setting some of those um those costs firm in 2027. Uh crystal balls are are If you would have asked me this time last year, I would have set our crystal ball on inflation's pretty good. Uh right now, I don't think my crystal ball is good for six months. And so, uh the the opportunity of of fixing future inflation uh even in 2027, I don't know what that means. I think um we're we're we've already seen signals from contractors as early as October last year that they expected some inflationary pressures uh in double digits. Uh cons um as as Todd mentioned, there are some costs that aren't taken into account above and beyond the 40 million in financing. Uh, as we get into the
016slide presentation, we talk about using some of our closed schools as a lifeboat, a place to house students to allow us the freedom to remodel and and better attack a project. It goes faster. It has less um unknowns in it and and the contractor will most likely bid better for us. But if we don't have those lifeboats, uh we're going to have uh a couple of things happening. will will have to provide temporary student housing, relocatable villages on those sites. Uh, you know, that could easily be a couple million dollars in its own right. Uh, because, as Todd mentioned, we're compressing so many in 2728, we don't have staff to to manage all of those. We'd have outside consultants uh coming in and helping to manage those. Uh, that could be a million dollars per
017project as well. So, so we'll have additional costs. Uh we certainly know that as we compress this in a tight labor market, we'll continue to force limited uh trades and stretch those. So we're not even sure how quickly we could get bids, how quickly we can get interest, and how we would contain costs with limited labor supplies. Um we would expect some sort of delays in construction uh because of the uh inadequate workforce. uh we would most likely have to start to implement uh mid-year moves at the schools. Uh just like Truman experienced, you do half a school at a time. And so it's in and out in a six-month period where the lifeboat you you stretch it to to the entire school year. We'll move you to a lifeboat, then we'll bring you back
018so you're not inconvenenced with mid-year moves. And I think that's it. It's hard to explain in dollars, but when you're at the when you're in the faculty of the school, you explain it in tension that that tension is a lot easier on a lifeboat move than it is uh and in and out. Again, risks uh abatement uh asbestous abatement while school is in session because we're only doing half a school at a time. And then uh I think there's a risk of missing of missing key uh milestones uh again interrupting those the flow of movement in the school and when they can reoccupy. So a lot of challenges when we advance so many projects so quickly. Does that cover our discussions? Right. Uh some thoughts on the pay as you go and this helps to
019explain uh maybe the moving parts involved. Um, we would maintain this as a 2027 project. We'd continue to adhere to that standard established timeline. We are very fortunate that the site is large enough to rebuild on site. There's a large enough playground. We're a little over 10 acres at this site, which is luxury. So, we can build on site uh and move them all in at one point in time, move them in, and then finish up our parking and things of that nature. So, it's a a reasonable uh building to do on site. Uh we could advance the Calvin Smith remodel as a pay as you go by one year. Uh we like using the Westbrook campus as a lifeboat. It's right up the street. Uh if uh as we continue to to look at
020the busing, we have some coordination, but it seems like it's a doable lift in 2028 to to pick up the kiddos and bus them. Uh and again that we we have Plymouth, another Taylor'sville school that's slated to to remodel at the same time, but we thought because of proximity do Calvin Smith first. No other reason. It's just easier uh to handle the transportation as your first go around. Don, what's the details as far as like why would the school need to be relocated? Is this as asbestous that they're what what's the purpose of relocating them entirely? Uh the lifeboat concept is lessons learned both from Canyon School District and Granite. So a great lesson learned we uh rebuilt South Karns by lifeboating them to Ogre Hills. The contractor in a remodel has the site to
021themselves. They are more efficient. They can do many elements of the school at the same time. They don't have to wait and recycle their their construction crews and bring them back and and restage. It's much cleaner. It is true with abatement we can get in out and done with abatement and not worry about anyone present at the school site during the abatement cycle. But is that what they're like what are the details as far as what what that remodel would look like? I guess that's the question because I'm I'm thinking like a facelift. Is that really necessary to remove kids? Sure. for for a remodel. We're we're trying to develop what I would what I would classify as the $6 million remodel. What what's in there? Uh you would do as much abatement as you
022can. You would do a lot of the aesthetic components or or the surface components, cabinetry, carpet, ceilings, lighting. Um you would probably get into quite a bit of the mechanical system if it hasn't been done already. Um You know, uh, in the case of Calvin Smith, it probably involves a chiller. We've recently redone the fan room, so we don't we won't go into that. You can do some exterior aesthetics. You would try to extend that into as much playground space as possible. You you're finding all the worn out items that are there. And when you're doing a significant interior remodel, you are disrupting everything about that school for probably a seven, maybe even eightmonth period. And so even though you start it as much in the summer, you're still going to be impacting students and
023it's hard to do a complete power takedown in an open school to effectively go through the circuitry and make sure you've got it all done. It's a lot easier if you're dropping the electrical system down, if you're dropping the mechanical system out, not trying to run half a school while you're trying to replace a chiller. you're, you know, you're not trying to squeeze that chiller in in a fall break. You actually can take it down and do it right. And we always have all of those challenges. The end of the day, I I kind of compare this to like a home remodel where you think you're doing one thing and then as soon as you start it, it leads to something else and then after you fix that, it leads to something else and something
024else and something else and you're like, why did I even start this in the first place? Um, so and having seen Truman go through this total disruption over the last year, year and a half where they're half the year here, half the year here. I see the wisdom in the lifeboat, meaning just get them all out of the school, clean, you know, and then let people work. Another case in point is our skyline model versus our Cypress. Cypress you're building not on site and it's going up a lot faster whereas it's been very meticulous and a very long process to get skyline built because of the restrictions of moving around. So that's kind of where my brain is is with us. Yeah. And and and later in the slide deck you'll see where we reference
025that we believe it's actually more cost effective per square foot to use model. the contractor not having to work into a live school and being more efficient will charge us less. They will add costs to the building to accommodate all of the movement and we think or guessing predicting um that it's cheaper to even transport etc etc into the lifeboat than it is to pay for the enhanced construction costs. And they are correct in charging it. It's they're they're not take quote taking advantage of us. No, it will cost more for them to be on site in a live active school. And I appreciate that. I just want to I know I'm going to get questions about that. So, I just want to make sure because teachers don't want to move their classroom for a
026year. I think it was helpful to review that. I've had a couple people emailing me in the middle of a conversation asking what these remodels look like and it's nice to kind of review that. We we're still developing what $6 million. So, the the budget has 6 million in it. We're evolving what 6 million looks like in this market. I mean we truly you know are not completely settled on what we can do with the 6 million uh you know seismic input as well right we want to do seismic as much as possible that's tightening in the roof that might be doing some cross bracing and wall structures etc and that's really hard to to ensure that you get it all done while occupied it it can be pretty darn disruptive because it's not quiet
027when we start adding structural elements Don also up here when it says advance from 2028 to 2027. I guess I'm assuming that what you're one year saying up there is if we did the max bond scenario. No, this is the pay as you go. Right now it's listed for a remodel in 28. The revenue stream's looking like we could bring it up to 27 and go a year early. I see. So it's part of how do we advance this? We're looking at cash flow right now to see how we advance. Okay. Thanks. So, even with a pay as you go, we can bring things online earlier. Okay. Okay. Uh Taylor'sville High is a really interesting example how if you phase this uh you can uh get things going. Now, these are fictional numbers, right, to
028to get something going here. But, you know, we we look at at roughly 32 million uh for for core construction. It takes you about 4 million for FF&E. Uh and then that contingency uh the more we've talked about it even since this presentation was made is light. We take that from a two to a 3% contingency at least in this market. But, uh we can do some some some upgrades. So, we were planning to to break ground on the addition in 27. You can actually come in early, do some remodel elements in 26 that can be accomplished in a 10-e period. So that could be auditorium type upgrades, be it performance lighting, seating, etc., etc. And you can also advance some exterior things that are are challenging right now. We don't have security or safety
029fencing around the track. You know, you can still rush the field at good old Taylor'sville. It's, you know, we'd want to change that. Um you look at equity issues, softball score building it, you know, they don't have scoring and storage out at softball. So those type of elements we can bring online early and then in 27 you come in and you do the addition and the addition is adding uh new office up front for single point of security ingress and access. Uh you know mid20 additional classrooms uh to get rid of the villa out back. uh those type of things would be in the program. And yes, ma'am. So, what is being sacrificed in order to move this up? I've been very clear about not moving projects over each other. Um I want to know
030if we do this 2026 thing, what is being put to the side or is this literally did we what pot of money did we find in order to move this up? It's just your cash flow. it it's it's coming in in a manner that that we can do this without impacting other projects when we're looking at our cash flow predictions when the two high schools are ending right Cypress is coming in they they they're the way they're maneuvering around the tear down of the auditorium uh etc etc it's advancing things it's just turning the clock a little faster and we're starting to pay it out faster so we're just gaining months to be clear though that's not the whole thing that you're advancing to 2026 it's just some of the stuff upon stuff. Yeah. So
031the the rest the main part of this will be 2028. 2027. Yep. Or 2027 or 2028. The main part is is is coming in at 27 in our in our cash flow assumptions. Because again, you're you're not building it in a year. This addition will take you 18 22 months. And so we're just we're just managing our cash flow expectations right now and looking at how you still stay positive and and you don't go negative in your payments. That's all we're doing is is getting to the point where we're trying to say, hey, it's predictable in this handful of projects that we're talking about tonight that we can manage our cash flows and start these things and finish them and still have positive money at the end of the day each year. Now, that would
032mean, for example, the high school could would need to start design discussions this year. We'd kick off design to to figure out how to do all of this, and that's all included. Um, so, uh, we would keep, uh, Plymouth in 2028. Uh, again, we would be out of Westbrook with Calvin Smith followup and move, uh, Westbrook in. Uh, again, Plymouth is a really interesting school. So, if you were to ask me what's going to happen in it, we have to pause. It used to be a an open uh classroom building and they walled it in and it's still funky and I think it's just always going to be a little funky. It's just that open plan concept is always hard to work with, but it has a lot of uh you know physical constraint issues.
033It needs new roofing. It needs structural upgrades. It needs mechanical upgrades. All of those things would be deployed as part of Plymouth as well. And then uh you could uh retain Moss remodeling in 2028. And you we haven't gotten through the end on this, but Mil Creek could be a lifeboat. If not, you're bringing a reo village on site. It's large enough to do a reo village at Moss. So it has flexibility. We just have to figure out how to deploy it as well. Mil Creek's not as ideal as as we see Westbrook because it's a little bit of a longer drive, right? The the the the transportation element still is uh has a lot of kinks to work out. So again, uh we we really have to review that. Um and and our fear
034right now is we're not positive we have efficient and manageable bus routes yet, but being out in 2028, we have plenty of time to study it before having to commit to that. Uh you'd retain Arcadia El's construction timeline uh in in Q. uh it allows the upcoming boundary studies to complete and it also uh avoids some premature site configurations before the consolidation uh discussion needs to occur. I I worried about knowing that we were coming into that area under Todd's scenario because it advances to 2027 and that's a push to get through all of our boundary considerations before you have to do detailed planning. Remember, we have to start planning more than a year in advance before we start a school. So, we would be we would be working with architects and engineers at the
035exact same time boundary discussions are happening and that could get a little cumbersome. So, the pay as you go in this uh circumstance helps us. So, this is just a summary of our our initial thinking about um h how you handle it. These comprehensive remodels, again, seven months and with a 10-we summer, you you're just you just want to lifeboat it for for a lot of reasons. And here's just kind of our our list of w of how we pull off the first few rebuilds and remodels. And again, gracious that uh West Karns is large enough to rebuild on site. Again, the advantages of life uh the lifeboat, we have faster uh project completion. We enhance student safety because we are not having construction constraints, kids needing to be fenced away from construction. Uh it
036we're pretty positive we'll get higher construction outcomes. They won't feel as rushed. And if they need to take systems down to do a better job, we don't have to worry about interrupting instruction to do that. and we're we're we're believing that there's a cost savings from the contractor. Again, our challenges, transportation costs. Um and then there are some complex fees associated with relocation of resources, but we've done it. Uh we know how to do it. Um you know, in the case of um of Westbrook being for two elementaryaries, we'd probably just set up a media center that both schools could use. It's not quite as customized, but it saves a lot of time and energy by just buying a media center or taking one out of our recently closed schools, setting it up there, and
037then those schools just rotate through. So, we're conceptualizing how to how to maximize um our efforts and not be redundant in moves, not be redundant in acquisitions, etc., etc. And we think that that that we have some some efficiencies that that have been different than our opportunity with South Karns moving to ochre and with uh how Truman was staged on site. So we're looking at all of those. And we do think that it's less stressful on staff to just make one move, complete the entire school year. A midyear move on staff is hard. they feel like they have a day and a half to move and set up a new classroom. I think that's too stressful. And if you're just gone for the year, we move you back in the summer and you set up
038coming back in August, it's a lot more uh more effective for them and less stressful. So there there are a lot of benefits for that lifeboat versus an an on-site major move. And uh you know the on-site relocatable village, we can do half a school on site. I don't know how you provide a full elementary worth of relocatables on site. It gets too crowded. It doesn't work well. And keep in mind that it's really challenging to have a large enough multi-purpose center relocatable building and a large enough kitchen relocatable building. So you're always pushing into a core of the school. Even if you did get relocatables for every classroom, it the lifeboat just through our experience and that of Canyons and Canyons has done more than we have that lifeboat seems to be the best
039alternative, easiest on kids, easiest on staff. Uh so some budgetary and planning considerations we need to to understand are not to exceed budgets when they're appropriate. Again, I've talked about, hey, I want to spend roughly, you know, that $6 million mark on a remodel. Okay? Then we can design to that instead of, you know, you hit you hit your your really important stuff first, right? It's if you know you need a new mechanical system, that's first on your list. It it may not be repaving the parking lot. That that might be the thing that suffers to balance your budget. Um we're looking at um you know I call it frugal building programming. So we we have three models of schools that we've sent back out to cost estimators. I'll call it the Oakwood model, the
040Armstrong model, and the South Kerns model. We're trying to understand in this market which one prices out better. And each one of those has a different amount of steel in it. And it's that steel cost that we think is going to to really impact the cost of a building. So South Kerns has more steel than the others. So we're just trying to understand what that cost is and we can program those in and help keep us on budget as well. That's part of the pay as you go model is understanding which school is going to meet your cash flow needs. And then again, just making sure we don't overbuild or or do too much as part of that frugality. Um, we need to know from you the direction on the lease revenue bond desires because
041it changes how we deploy and it changes costs and we would add some of those externality costs back in. Um, I think looking at uh at a roll out, I think implementing the projects in phases instead of trying to cram them as heavy in 2027 reduces our risks. Going into 2027, I think the industry is not prepared to deploy for as many remodels as as a as a large uh lease revenue bond can do. Uh, and then I I like having lifeboats. I think it's better for kids and better for staff. Uh and then it allows us to monitor those construction environment costs and escalations. If if if I see costs getting so out of hand, you bet I'm going to come back and look at Todd and say, you know, $16 million in interest
042isn't the worst thing I've heard of. And I and we'll be ready. We'd be more willing to accept more risk if we see cost containment getting out of our control. And we have to be prepared for that, right? I mean, that's that's really important is is monitoring what it's going to do over the next couple of years. Those are our basic thoughts of of where we think we can head in a roll out. We can advance projects based upon what we're seeing right now in cash flow. And I just wanted to be clear here after our last conversation, I I I went to these gentlemen and asked them to look at lease revenue bonds as a potential way to to move those projects up. So that is not something that was requested here. I just
043wanted to make sure the board had all the potential financing options available to them as we take in consideration these difficult challenges and decisions that we need to make. Any questions, comments? So I just want to make sure that I'm got this right. the cost of building has gone down compared to what we thought it was going to. And so therefore now we can move it to move the dates to a new a new baseline, move everybody up a couple of years according to this new baseline. So the it's not that the costs are going down, they're not escalating as fast as we had anticipated. Yes. So that so that so looking at future projections, those costs are not growing as fast. Okay. We also uh updated our revenue estimates as well compared to 2019
044and we're in a high inflationary period so we're actually earning higher interest on our money as well. So we've taken that into account. So it's both pieces are moving to our advantage right now. Okay. I didn't understand that part. I appreciate that. And then um uh when we look at these three scenarios, we see uh for going out for bonds, we see that they'll cost us 116 million, 131 million, and 140 40.5 million and that they really only barely move the dates. Um, and so it seems like something not recommend that we are not recommending doing because it won't have an impact and it will cost us a lot of money. Is that correct? In my opinion, that's correct. That the the costbenefit analysis doesn't suggest that a lease revenue bond is in our best
045interest. Okay. And then um my I'm sorry to return to a previous issue. I'm back to this Taylor'sville issue that Karen was having. Um I mean when I look at the new baseline on um I guess I would go back to slide revised proposal slide. Um so it does say here that Taylor'sville 2027 but these ones that are above it 2028 2029 can you just I I think I'm not quite understanding what you're saying. This to me looks like we're moving Taylor'sville above above these other schools. Help me again to understand why that's not the case. That's where I am at too, Julie. I I I'm like something has if we have extra funding and we've got our Why are we putting it into those is moving up and I just want to understand the
046why and the justification. I'm not even saying I'm not opposed to doing that. I just want to understand understand it. Yes. A lot of it's our lifeboating scenario. How we move these schools around using Westbrook requires time and patience to get them there. And so I I'm able to slide Calvin Smith early, but I can't slide Plymouth early, too, because they're going to occupy the same Westbrook. So that's why it has to stage later. Remember, I'm only revenue revenue ability. I can slide Calvin Smith up into 2027. Now I have some revenue savings where if I wanted to use reos and start Plymouth and make it a 16-month project, I could. So don't the calendar mistake there is all about how I lifeboat things, right? But Moss doesn't go to that. Moss would be more
047looking at Mill Creek. It could, which would be available. So Moss is still ahead of the schedule than Taylor'sville. So I understand. I mean, you can't have Plymouth and Smith Yeah. both occupying a lifeboat the same year. I I think that's very understandable. And you know, I I can see the justification for that. I think I'm still having a hard time justifying the moss because that's still above. We could look at moss. I haven't put it there because it it I wasn't completely comfortable that I can make transportation work out. By the time this study session came, we were not positive that we had a transportation solution for Milt Creek. So, so that's that's just me being really cautious and saying I need to study it more. We could come from a cash flow perspective,
048you know, x months from now and say, "Yeah, do you want to move it up?" those that's the flexibility of the pay as you go model is you have enough time to study and then you could talk about a cash flow commitment. So part I I you are correct in that presumption. I just didn't feel comfortable today saying I've got transportation figured out because I don't think we do. Well and I'm reading this correctly. The projected start date and the revised date is the same for that for Moss. So it's not changing actually their start date. Correct. that they're they're staying at the original delay the original delay mark. Yes. And and to be clear, Chris, I'm not saying that they're not advancing. I'm saying that Taylor'sville is pole vaultting. That's that's that's what I'm
049saying. And I I'm just trying to understand. I mean, this is a study session, so just trying to wrap my mind around some of those details as we move forward because, you know, next time we have this conversation, maybe you do have busing for MOS figured out or stuff like that. So absolutely. Yeah, that's so go ahead. I would have loved to advance Moss as well because from a cash flow perspective, we we probably can, but from a making it happen perspective, I don't know if we can. Just to add into the conversation, and I I get it. I don't want to I I certainly don't want to disadvantage a community just because we have a squeaky wheel, but at the same time, we have a relo out at Taylor'sville and Moss is in their
050building and that's a safety concern for a lot of parents out there. So, while I understand that Moss is still in need of a a a remodel, Taylor'sville is is also in great need to have their students safely in their building. and that's not happening right now. So, I don't want to I certainly don't want to put it in front of West Karns, but I don't feel like moving Taylor'sville up that year in front of Moss is that unreasonable because it is something that is a safety concern for those students and I can appreciate that concern. I would also just say we have a lot of high schools with a lot of reoss. I mean, Granger had reoss from the time it walked in. So, I I can understand you advocating for that community and
051and I totally get it. I don't know that I 100% buy I want kids to be safe. Let me be clear. I'm not saying I'm against student safety. I'm saying we already have existing schools with reos as well, which leads me to walk away from that argument a little bit more. I also, you know, I was not on the board when we um came up with this plan and I I can tell as we discussed this that I still have holes in my knowledge of understanding things like I think I need to get with you, Don, and have a discussion about how did we determine remodel versus rebuild. Um think questions like this that I'm having that we don't need to go through here. It's it's a fairly easy answer if you'd like. Well, let
052me get to my actual question. My actual question is that I believe the thing that I'm concerned about with this timing is that I believe we made promises to taxpayers and this changes those promises in my mind because number one it does look like a change to move tailor but it looks it appears like a change right so we have to be able to show a cash flow model that can show to somebody no we're not changing the this is what's going like I'm talking about being able to see the spreadsheet in my hands to look at that cash flow model. And then the second thing is I'm concerned about what are the ramifications of these red schools, these schools that we've closed that we're proposing on the revised proposal to just not rebuild. I
053mean, I'm having people from my area saying, "Well, if you close our school, you've got a you made a promise you were going to rebuild this school." And I think I heard that at Orchard you made a promise to us that you were going to rebuild this. So where are we on this? What is the deal? I think and and superintendent please. You and I were at these meetings and this was something that was repeated with no exaggeration at every public meeting we held when we talked about the bond. the the the general statements from the public were, well, if you're not if you don't need a building in the future, you're not going to rebuild it, right? And so that was the promise that no, we're we're not just going to build to build.
054They wanted to make sure that we were being frugal uh that that we were being good fiduciaries of their money. So when you understand the context of the public input and how pay as you go was created, they did not want us just to mindnumbingly go and build because it was on a list. They understood because we had had some closures at that point in time that that we we were considering these things and they just really asked of us almost demanded of us if you're not going to need a school just don't go build it. And so that I think Ben and maybe Connie can can speak to. Yeah. Well, I think the the broader thought process there is um even as I think some people get convoluted that we went through this whole
055bond advertisement process in in 2016 and then went through the actual bond campaign in 2017. We did a wholeformational campaign to the public about different types of funding options and that's where really that question came up and then obviously as part of those meetings. We didn't really start in earnest closing schools and doing our pack study till just the last several years, right? And so, um, those were two very separate and distinct possibilities, but we knew we were declining in population. And yes, the assurance was given that we were not going to rebuild schools that we didn't necessarily need. And there were certainly taxpayers in those meetings saying, you're raising my taxes. Do you are you sure you need all these schools? And the answer is we didn't know at that point in time. At
056that point in time, we didn't have the Davis demographic data. I'm to say that we expected to lose so many students over so many years, right? Um, but yeah, the the commitment was there. But I I also want to point out that as part of those boundary closure meetings, and I'm thinking of Sandberg in particular, some of these were previously left on the list very intentionally by the board at that time and not removed from the rebuild list because they wanted to afford um future boards the opportunity to make those decisions um and decide what to do in the future. And so I I think that was with the best intent to offer as much flexibility as possible whether um and and goodwill too. I think uh to some degree our communities want us some
057of these schools may not be in the right spot and uh potentially rebuilding one of them and closing another school uh might be a nice consolation. Uh I'm not saying that's the the thing we should do. It certainly should be something that merits study, but that's why some of these have been left on the list as well. I just want to provide some additional context. Well, and I really want to say I don't think as we went through the bond that we promised that these things would, you know, that the first 10 schools would be built I and remodeled or whatever. I don't I don't think we made that promise. I think we did it saying these are the ones that are needy and these are the ones that are there. But if people don't
058understand what happened to all the money that we got, I feel bad because the prices went up so much that it wasn't our fault. It's not our fault we don't have money to build. And so I feel bad. I The ones that have asterisks on it perhaps we said, "Yeah, they'll be the ones." I I don't know. I don't really The asterisk represents those that would have bond proceeds go to the project. Okay. So, they were designated on the voter information pamphlet and um it does require a board vote to change and alter those projects in and of themselves. I was just going to say I actually remember it very different that the order was very much a big deal for people especially when we were going out and asking um for their support. And
059I do remember having earlier conversations about doing a little switcheroo and it did require it it would require a vote in order to to do that. So we did change it. Correct. We could I mean there's the option then you're up against your earlier argument of yeah but if the you know if my community X voted for this community then all of a sudden then you're breaking those promises. And so I I just I remember that conversation a lot different that the order was was kind of a big deal. But the promise was made that the bond proceeds would go to the asterisk um buildings and then the rest were going to be done on a piece. If you look at that, that's the intent was that based on the modeling we did that was
060fairly conservative at the time, but proved to be inadequate uh based on an unknown economic uh catastrophe that occurred in the form of tariffs and I don't know a global pandemic um blowing up uh our price model. Um you can see all those with asterisks are actually rebuilds. The remodels were never part of the the bond package itself. they were part of the overall strategy. So, they were listed on a list because as Don's talking about the um our cash flow model, that was intended to be that 40-year strategy that we continued to pull those funds from for these ongoing projects. So, technically speaking, uh legally, as long as we build West Karns next, there are no bond proceeds left, per se. So it's we are using our cash flow at this point in time
061to continue the projects as long as we continue with our west kerns and Arcadia. All the rest of those projects are really up to the board to decide how they would like to proceed which there would be anyway but obviously we want your input and feedback. Board President I've asked a lot of questions but I have one more. Um can I just proceed? Okay. Um so I I feel strongly that there that this list this like order is important. Um but I also and I think that that order was created from the FCI scores. Is that correct? So now I guess those are what 9 years old. Do do we feel like those are still accurate? Is there any desire to go look at that again and make sure this list is accurate and that
062the board doesn't need to move a project earlier for need? Like I think Nicole's making that argument a little bit for Taylor'sville that even if it is being moved up, we need it immediately. I mean, do we know that this is still representing the greatest need? There there are two questions in your question. uh let's let's talk about the FCI score uh and our worst first model, right? That's how we wanted to approach this and and we still are approaching it that way. Uh there are improvements that if we were to go back and reassess the building, uh could there be movement in the list? Yes, there's not wholesale movement in the list. Uh because a lot of the elements that drive the higher FCI score are structural in nature. They move it the most
063and that 70 year old building hasn't gotten any better. We haven't had an earthquake since then. We've even had an earthquake since then. I I'm saying so that those structural systems in my mind would have repaired all the earthquake damage, right? We went back in and did that. So, it's not it's not playing with the the review that much. The the types of improvements we're making that would make those enhancements to the FCI score so minimal that it wouldn't wouldn't drive. talking about carpet, paint, not a lot, not HVAC, structural, new roof, things of that nature that would really drive the FC ice. So, if it was an earthquake damage situation, that would be now rebuild and we would have already identified that structural problem and insurance from money for Okay, got it. Taylor'sville, the
064addition was to handle the increased population that had recently we brought n 9th grade up and it was on everybody's mind during the cycle and it was meant to not have the relo for as long as it's had. So that one that one is hard to say, oh it's an FCI discussion. Taylorville was a capacity discussion as nth grade came up. So that one again that's that's your second question in your question. Taylor'sville had a capacity discussion about 9th grade leading why that was going to get an addition. And by the way that was the same type of discussion that was concurrent with Hunter High School. Hunter High School received an addition with some cash flow that we had because it had 9th grade move up. So those two schools were treated equally in the
065population increase discussion. I would say this, I I really appreciate what you're you're indicating in terms of the list and public perception because the complexities of our financing are such that most people are just going to look at this list and they're going to question any adjustments to it. And I can appreciate that and I want to make sure that we're keeping our commitments and that people know and understand that we're trying to do what we intended to do. Um, that being said, we also made commitments to the Taylorville committee community when they requested to bring 9th grade up uh with expectations that we would be able to get to this project a lot sooner than we anticipated. And uh I I don't I don't know if the community would have requested I'm putting you
066in a bit of a pickle here. I don't know if the community would have requested having 9th grade be brought up as soon as it did. Um, had we known that some of these challenges with financing would have come along and with the economic circumstances. I don't if they were going to sit in a reload village for as long as they have, they might have said, "We'll hold off on 9th grade reconfiguration." And I think Cypus would be that same way if we would have not used BR Bank to add our ninth graders if we knew we were not going to eventually get a new high school. So, I think it would have changed some of that. So, I guess my point is is that I think we're keeping our commitment one way or another
067here. We're trying to honor there's another commitment in play. Yeah. As well. I I think though that with that conversation comes the importance of recognizing that I mean here we are. We're when we chose to move ninth grade into the high school, we also made a financial commitment that came with that decision, which was something that we as a board decided was worth it because it was so important to have 9th grade and we felt like it was going to be such a big deal for our students, right? But in the meantime, we also recognize that that has had an impact on our elementarymentaries. Now, while the impact on the elementaryaries were still the goal is three teachers per grade regardless of whether you have sixth grade in that school or not. So, it doesn't
068really impact whether you're closing a school or not. It does impact the capacity in that school, right? And so, a lot of people I'm kind of thinking through this right now as I'm talking aloud here in public board meeting. I uh you know, as you look at that and you're wondering like, is my school big enough to handle three teachers per grade? Moving that sixth grade out actually does give you more opportunity to actually reach that three person per grade. It's really interesting how that issue, the reconfiguration and the declining enrollment is all such a huge part of this right here. It's like all comes together. Any other questions or thoughts? I just say thank you for putting all that information together and um I mean to me it's good news. I'm glad to hear
069we feel we can move on a pay as you go model and still maintain some of these dates. So very appreciative of that. So it sounds like that's our our best option and it sounds like that's what people are supportive of is just to continue the pay as you go model. But yeah, we appreciate the work that that went into this. You bet. All right, let's go ahead and move on to our next item. Is that the hot seat? Going to trade some. Are you coming up here or are you just sitting here for moral support? Brian's here for moral support. And I also told him that it's okay if he rolls his eyes when I say something wrong because then I'll quickly fix it. Do you want me to start now or wait a
070minute? Go ahead. All right. We're into the exciting season of budgets and trying to pull everything together that we're hearing at the state, federal, and local levels. And uh so we we'll walk through a few items today. We'll talk about revenues. We'll also talk about uh some impacts that came from the legislative session. Uh we'll review some of the one-time programs or ongoing programs funded with onetime monies uh from this school year. Uh we'll talk about uh the process of the budget requests that are coming in. Uh they were due Friday last week, so some of them didn't show up in this presentation, but that's okay. um we're we're basically in the same ballpark. Uh with that, we'll talk about some tax policy and also talk about a capital plan a little bit different than
071what we've just spent the last hour talking about. This has to do with our regular capital process. Uh hopefully at the end of this conversation, you'll have a a pretty good knowledge of the revenues that we have for the district moving forward and also I'll be talking about a multi-year challenge that's coming our way. So hopefully you'll understand that as well. You'll have a good orientation on what our budget needs are as we're coming into this session or into this season and uh we'll talk about tax policy and some directions that you may wish to give us as we put uh the budget together and try to balance it. This is purposely too small to see. I've done this because we will spend time in each of these columns. So, I've I've captured the different
072budget items that we will be addressing this year into different categories, and we'll talk through the categories uh so that they make sense to you and that you uh have a a better idea of what challenge we're facing and how we have to manage our revenue and expenditure picture. Uh please note that these numbers are all estimates. This is not the number. Uh, in fact, we just received this morning uh a early copy of the legislative impacts by LEA where one of several districts was asked to go through that process and make sure the numbers look right before they're published. So, we have an embargoed copy, if you will. And and they all increased, didn't they? Increased our funding. they increased all everywhere for every everybody else but not so so again if you just
073keep in mind as we get into these numbers you you'll actually see the numbers as we get into other slides their estimates uh we will be finalizing those numbers uh in the course of this month and also be refining our numbers as we get into uh the budget requests that are coming from the departments. So let's take a minute and talk about the revenues at the state local level and then we'll talk about reserves uh as we were in the news back in January with regards to why do we have reserves and why are they the size they are. Uh I've stolen this I've taken this right off of the legislaturator's uh highlights page of the 2025 legislative session. So these are the items that they're proud of and I think they're in the right
074order for their pride. So they uh talked about tax relief being their number one thing that they wanted to take care of and that's what they accomplished. Public education's next in line. Uh they did fund a 4% increase in the WPU. Higher education, affordable housing has been a major issue and they put monies aside to address that along with homelessness and uh every year they also have a piece that talks about the compensation package for state employees. So So those are their those are their big talking points. This is what we accomplished in 2025 fiscally. Just a quick question just so that we know what was the what was the inflationary rate this year? The inflationary rate was 4%. So we got the inflationary we got the inflationary rate on the WPU according to the
075framework but nothing over that. Uh so there are other pieces of money that come outside of that framework. There was monies that went to Utah Fitzall. there was monies uh that on one-time basis went for uh more safety uh budgets for the school safety and some other pieces as well. But it's just a one time budget. Those those last pieces were one time. As far as ongoing, there was not a great deal of ongoing money. And so uh for getting the 4% was a pretty great deal. Included in that though was ongoing money for a $1,000 uh increase on top of the regular educator salary adjustment increase of $1,000 and that is coming out of a ongoing bucket of money. That's the the funding on that is the equivalent of another 1% on the WPU.
076So you could you know if you wanted to say oh we got 5% and they earmarked 1% of it. I mean you can spend that how however you will but that's uh some of the the commitments that they made through the session. But Todd the 4% was required of them by law. So in by law they are to consider that as a priority a top priority. The law does not compel them to appropriate it. It compels them to do the math computation and set it aside for budget discussions. We're fortunate in the last three years that they've actually acted on that piece of statute. Oh, I didn't understand. So I thought it was law. Nothing's automatic. So it's in law, but it'll it still make it a priority. Correct. Not in law that they give
077it to us. There there is nothing automatic. I do understand that. Um and then um and then that money for Utah fits all I understood that that was ongoing. Is that that's one time? So the Utah fits all is has a curious appropriation. So they appropriated $40 million as additional monies, but the appropriations act itself gave them 40 and took back 20 million on a one-time basis. So you could say they received 40 million ongoing, but they will receive it in two pieces. One in fiscal 26 and the rest in 27 because of the way the act was written. But then two years from now their ongoing funding will be the full 40. Um well I'm looking at because originally they had 80 million they have 82 million ongoing and now so it will be
078the 12 Correct. But their access to it will be limited in 26 to just the 102 million. Okay. Thank you. Translating now that information into Granite School District. So on the top of the line here, we have the 4% increase in the value of the WPU. But through the process, there were a number of programs that were either defunded or uh cut alto together. Uh so when we look at the programs that had run up that have run out of money essentially when the school year ends the money ends that takes away about 4/10en of a percent. We have programs that were cut during the session that takes another 3/10en away. Our school fees law finally comes into force that represents a.5%. An unexpected change was a professional staff. So this is a a line
079item that was above the line, meaning it was funded by WPU and they cut the program both statutoily and fiscally. They removed it, but then the funding they returned back to the districts through what's called the flexible allocation line item, which means it has no designation of purpose. It just goes to the districts on a WP basis. So we in that translation we lose about $2.5 million or in this case it's 7/10en of a percent that we lose in that movement from above the line to below line. So that was that was an unexpected hit. Uh we also had the voted and board uh guarantee program. This is a program that guarantees the tax shield uh on our voted levy and on our board local levy. Uh you could say that this is a misrepresentation
080to a degree. This is the full impact. We would lose the equivalent of 4%. Uh but there was a mitigation measure. So they actually phased this out over three years. So we won't have this full effect next year, but at the end of the day, we will have this full effect uh in the next three years. I put it on here because we're going to have to deal with that challenge. um school safety. There were Yeah, go ahead. Sorry. Can you just explain that one more time about on the voted and board? So, the the state guarantees a tax yield on the voted and board uh levies, which means that for every increment of tax we assess uh multiplied by each WP that we have in the school district, we will receive about $62. If
081your tax levy all by itself does not get to the $62, the state gives you some money so that you get to $62. In this case, they are taking away what's called the hold harmless period. So there's a this calculation for that $62 actually goes back in time. It goes back and says whatever your highest tax levy was in the past five years, that's where we'll do this math calculation. They changed the formula to only look back one year. For our district, our higher rate has is five years ago because we've not adjusted our rate as the certified tax process has dropped the rate annually. This is a a rate impact. And so the fact that it's come down, we will receive less state guarantee. Is that helpful or did I get it more muddy?
082Brian didn't roll his eyes, so I think I'm mostly okay. All right. Uh, and then we also have the impacts on school safety, which we still haven't fared it out yet to to understand where all of those are. So, if you if you take all of that, we're actually 2% value on the WPU, further behind at the end of the session than we were at the beginning of the session when they gave us the inflationary adjustment. So, it was not a favorable session for the Granite School District primarily because of the change in the voted and board leeway guarantee programs. Um, hey Todd, what what bill was that? So, it started in Senate Bill uh 132 and it ended up in House Bill Two. So, so it ended up in a one of the regular
083fiscal bills. I I'm just like this is shocking me and I'm pretty engaged in the legislative session. I mean, why wasn't there push back about this from the education community? Oh, there was Yeah, we we spoke against the bill and then it slipped. It disappeared and reappeared in House Bill 2 like at the end of the session. So, it happened very fast. Um it happened subtly. I don't know that it happened fast, but it happened subtly. I see. And so when we saw House Bill Two come out the Monday, which is the last week of the session. That's we all went, "Oh, hello. This is why we thought the bill was done, but the language came right back." Okay. It happened the week I got sick. That's why I can see now. Actually, can you
084go back one more? I have one more question. The pro staff change. Um, what bill was that? the pro staff. Um, and also can you tell me like what's the staffing change? Okay. Associated with that? Yep. I want to say pro staff was also in House Bill 2. So when they moved it from above the line into a below the line program and then your second question is how does it work or well like what program is it? Uh so it's not a particular program. It's a funding mechanism for compensation. So the professional staff provides additional money on a WP basis for years of teaching experience and for educational attainment. Yeah. So steps and lanes. So this is this is state support for a step in lane model. They've taken the money away from supporting
085that model, given us the money back as just free revenue, if you will. It's not tied to a program anymore. But in that process for us, we lost money in that exchange. We didn't get dollar for dollar as it moved. Is that because we are losing the interest on that or something? I think it was the original. So the the dynamics will be our school district probably has more experienced teachers further down the steps and more educational attainment than other districts in comparison. And because of that they garner a higher wage or a higher salary through a step-in lane schedule and that's recognized in this form or was recognized in this formula. So as they moved it to the flexible allocation they also changed the formula. Well they yes they changed so instead of getting
086this extra weight for pro staff it's just like a regular WPU. Okay. So it it lost a.13 uh increase for us. Thank you very much for that. So on that big sheet we the first column was in green for money. So these are the dollars that are coming into the district. The and again this is the granite school district perspective. This is not state numbers. This these are the numbers that we're estimating for the district. So the 4% generates about $13.6 million. We also have a projection in for property tax. Uh fortunately for us, risk management scared us to death last year and said that our rates were going to go through the roof and then they didn't. So we have a savings and premium there of about a million. Uh we have an estimate
087on a net uh proceeds on a closed schools. Uh we also have turnover savings and this year the Utah retirement system is lowering their rates by a half percent. So there's a a savings to the district in that exercise as well. Uh you'll see two more lines there. One is reserves that are set aside. These are dollars that we had set aside in anticipation of some legislation coming up and I'll talk about which column they belong in as we get there. And then we also had some state funding that we're expecting that will help to offset the cost or the lost revenues from school fees. So that's the revenue picture. Yes, Todd. I'm so surprised to see that number under closed schools because I was under the impression that when we close a school, we
088save money on, you know, a few key personnel people. Yep. I'll get into that in a minute. Okay, I'll wait for it. Yep. Yep. There there's a whole column just for that. Uh let's take a second and talk about reserves. In the uh January or the month of January, there was newspaper articles that came out. uh questioning why districts were holding on to reserves and at the level that they had. And so I'd like to just do a little education piece here as to why the Grant School District has the reserves it has and for what purposes were holding on to those. Uh the first uh is that we have a several employee benefits representing about 26.7% of all the reserves. This is for our early retirement incentive program. This is the retirement stipen program,
089the paid up health insurance program. Uh once you leave the district as a retiree, uh these are monies also for uh leave balances. So as you acrewue leave, we have an obligation to make sure that we have sufficient funds to pay those. Uh and also this includes our health insurance program and our workers comp programs because we're self-insured. So these are all obligations that we have to our employees and we are required to have reserves sufficient reserves to fund 100% of those and we go through an annual basis with actuaries to make sure that we have the right numbers accounted for and that we fund the appropriate numbers. So we're not just making up something saying oh we need we actually go through a an exercise and have those determined for us. U so those
090are obligations those are real obligations. uh they don't go away unless you start changing policy on benefits for employees. They're there. Uh the next uh big category 25% represents our capital money. So this is the pay as you go money as we're accumulating that we're holding on to it as well as the monies that we need to pay our debt service. Uh this is money that's categorized. It's it's actually locked in. It can't be used somewhere else. It is only for this purpose. And there are legal structures around keeping it for that purpose. The next category is a special purpose. So we have another 17.5% of money that someone has given us money that we are obligated to use for that purpose. So these are the monies that we have in our foundation. These are
091the monies that we have at our schools as they're assessing fees or as they're doing donation or receiving donations and fundraisers. they don't necessarily spend it all that year that they've collected it. So those they sit in the bank account until they're used. That that's in this category th those types of activity as well as in our food services program. Those are revenues received and then they are only for food services. They can't go and be used for some other purpose. So that's why we call it a special purpose fund. Another 11% is in statute. the school board is allowed to set aside 5% of operating expense for a rainy day account, if you will. And so that represents 11% of reserves, but the cap is 5% of expenditure. And we uh are authorized to
092do that. And so we do that according to statute. Another almost 9% is our fiscal planning. As we look into the future, as we see what obligations we have coming down the pike, we will set monies aside. So, in this particular bucket, we have money set aside from when we had our technology review. There were certain uh improvements that we were expected to put in place or that were recommended that we put in place. We've set monies aside to accomplish those tasks. There's also been conversations about a second wellness center. Uh as we look at uh how our our current wellness center is operating and the subscription uh that we have, there is an opportunity to look at that. We've set monies aside also seed money if you will to be able to start uh
093fiscally looking at that. So those are plan. So things that we know about now they can be unplugged. if this is not the direction that we want to go, we can decommmit these dollars, if you will, and send them a different direction. But at this point, there is a purpose for them and and we've done it consciously. Uh the next bud uh item at 7 half% this is we've been anticipating law impacts, if you will, so we knew school fees were coming and so we've set monies aside in order to manage a step down of the funding that we'd lose from the state. uh so that we wouldn't be held in some terrible financial situation. It's not the long-term solution. We still need ongoing dollars, but at least we had some one-time money that as
094the state steps out of it over three years, we can hold ourselves harmless, if you will, over those same three years and give us some breathing room to decide what the what the strategy will be for long term. So, again, we we set those monies because we knew the legislation impact was coming. Same with uh school safety. We've set monies aside knowing that there are expectations on the capital front on things that we need to do with regards to buildings and uh facilities. Uh again, knew it was coming, knew the legislature wouldn't be providing enough money. So, we have set a little bit of money aside each year, if you will. And so, that represents about 7 and a half% of the the balance. The last 3% is the oh gosh, something happened this year.
095Doesn't rise to the level of a rainy day emergency. This is oh uh some situation has arisen and we needed to have some money on hand to take care of it. This last little bit of money, the 3% really takes care of the things that we couldn't plan for or couldn't anticipate during the regular budget cycle. So that's that's our story, if you will, of why we have a balance in the size it is. Um that 3%. So can you give me a couple examples of what we've used that for in the past in our district? I mean, I'm thinking leaky roof maybe or something that like broke or is that kind of those capital things or are they more something unanticipated budget-wise? That's what I'm I'm just wondering if you can give me an
096example. Perfect. See if I can pull that up for you here. So these are items such as so this is this year so I'll give you some ideas of what we actually had to deal with this year. So we already adopted a budget we're operating within that budget and then something came up and uh so in that world uh we the decision was to bring uh Brock Bank online. So it's going to be a school operating this coming fall. Well we have a bunch of startup costs. We had to hire a principal. We have books to put in the library. We have a school community council that we're organizing and putting together. So, there's a a number of planning things in front of that school coming up. Wasn't in the regular budget. We still got
097to do it. So, this little bit of 3% is what we lean into to to make something like that happen. Um, we also had one of our school buses was involved in an accident. Now we have a replacement cycle, but we don't have enough for when a school bus just goes down. And so we couldn't go without the bus. So we leaned into this this 3% money and said we need to acquire another bus to be able to keep our schedules uh working. Um we had a little bit of a data breach issue and so we're in a cash flow situation where we need money on hand until the insurance proceeds arrive. because we still have to pay those experts who are working with us through the incident. Uh so we'll lean into this. We'll
098pay for it and then if insurance comes then we'll reimburse ourselves. But in the meantime, it's not in the budget. We have bills to pay and so we'll we'll take care of it that way. So does that kind of give you an idea of it's it's stuff that that life happens and when you're running a really tight budget, there's just not money to make things be okay. So, we have a little bit of set aside as far as the plan projects. Um, is this like have we just continually been putting a little bit in every year and then and do we have a future date as to when we'll have enough for those or is that just kind of arbitrary right now? Uh, so I I am not aware of execution dates. So like on
099the wellness center, we're going through the analysis right now of determining what is the overs subscription of the current wellness center or is there an overs subscription? What are the types of services that are in high demand that we're not being able to fulfill? And if we were to go into a second wellness center, is there enough of that unmet demand that could support a second center just with that unmet demand? or do we need to get into some more marketing exercise to say, hey, we have a number of employees who are not participating with the wellness center but could benefit by participating in the Bel wellness center. So, can we drive some unmet demand into a second wellness center? So, we're going through those and there isn't a timeline set for those. That's just
100the analysis that we're going through. And some of this seed money would help us one to build a facility or remodel a facility uh to be that second center because that's the higher cost is the facility getting into it and then we'll manage the operations from there. Okay. I just was wondering like if there was a how long we're going to sit on that money or you know that because I can see that being a question. Sure. As far as that. Yep. And and again, th those are also dollars that as we look at trying to balance budgets down the line, it's one time, so you can't use it for a compensation package. You can't use it to hire more teachers. I mean, there are some limits because it's only available one time, but could
101be redirected at at your discretion. And Todd, um, the board approves this budget, but, um, how does something get in this plan projects category? Is that because I remember having conversations about our desires for technology upgrades and our desires for a second employee wellness center, but I don't remember ever voting like specifically, yeah, let's start saving for that. Can you just speak to process of how for a specific cause. No. Fair. Yeah. So, my experience has been it's been conversations with the superintendent as he has been in conversations with schoolboard members understanding what the the over over it's the way it's definitely more informal but but could be brought forward. I mean, if if we needed to have a conversation at that level, we can, but to date, it's been a very informal conversation that
102has happened between the superintendent and board members. And then I get a message that says, "Put it on the list." And I put it on the list.