Local school districts will receive more than $48 million in funding to make capital improvements, and plans include an expansion to the Career Academies of Decatur, a new Elkmont Elementary and a new athletic facility at Danville High.
The funding comes from a $1.25 billion bond issuance approved Thursday by the Alabama Public School and College Authority.
Decatur City Schools Superintendent Michael Douglas said the majority of the roughly $10.32 million the district will receive under the bond will be used for an addition to the Career Academies of Decatur, the district’s career and technical education center.
Douglas has said the expansion will include new construction which will allow Career Academies to house more programs in the future. Currently, the academies offer over a dozen programs, including automotive technology, culinary arts, welding and cosmetology. Douglas said with 40% of Decatur City Schools graduates not looking at attending two- and four-year colleges after high school, adding new programs in Career Academies could help create job opportunities for high school students.
"It'll be a big building that stands alone but also adjoins the other," Douglas said. "But it would also possibly allow us to … tear down some of the existing buildings that are over there that are in dire need."
Career coach Angela Cushing said the new building will be located where Career Academies' parking lot off of Westmead Drive Southwest currently sits, near the front office.
District Chief Financial Officer Mandi Jones said the remainder of the funding will be used on “various roofing projects around the district.”
In Morgan County Schools, school CFO Brian Bishop said the majority of the $8.75 million the district receives from the bond issue will be used on a new athletic facility at Danville High.
“We currently have the architect Goodwyn, Mills and Cawood working on the design phase, and the overall design will be similar to the West Morgan project that we just finished,” Bishop said.
Hartselle City Schools Superintendent Dee Dee Jones said the district will use its $4.56 million share of the bond funds to work on heating, ventilation and air conditioning at F.E. Burleson Elementary, pay off debt and begin the process of constructing what will be the new site for Crestline Elementary.
Jones said $1.65 million will go toward paying off debt, $1.35 million will be used on the Crestline Elementary project, and $1.5 million will go toward HVAC at F.E. Burleson.
Limestone County Schools Superintendent Randy Shearouse said the system's $13.26 million in bond money will be used toward constructing a new building for Elkmont Elementary.
“The $13.2 million in bond money won’t be enough to pay for the entire school. The new elementary school is part of our five-year capital plan and is listed in year one. The board of education also approved $3 million from our general fund this year to be set aside for capital improvements including new construction,” Shearouse said.
“We plan to designate $3 million per year over the next five years for all capital improvements. We are in the process of hiring an architect for the project and will have a better idea of the total cost once decisions are made regarding the capacity of the school. We are very excited to be working with the town of Elkmont and (Elkmont) Rural Village on this project.”
Athens City Schools will receive $5.65 million in bond funding, and Lawrence County $5.91 million.
A formula approved by lawmakers this spring doles out a base of $400,000 to each K-12 system, then more based on enrollment and a previous education funding formula. At about $977,000, Linden City Schools is the only system getting less than $1 million. The state’s largest system, Mobile County Schools, will receive about $61.7 million, according to information from the Alabama Department of Finance.
Colleges get share
Alabama’s four-year universities will receive a combined $217.8 million and the Alabama Community College System will receive $120 million.
Calhoun Community College spokesman Wes Torain said the school officials don't yet know how much funding they’ll receive under the bond.
“It’s good news, but at this point we don’t know how much we will receive or how we will use it. Calhoun Community College is one of 24 colleges within the Alabama Community College System, so we will have to wait to see how ACCS distributes the money to the colleges across the state,” Torain said. “We’re always excited about any potential funding that will help us improve what we do to serve our students.”
Athens State will receive about $4.57 million.
State Superintendent Eric Mackey said this is the biggest influx of state-issued bond money to K-12 ever.
“Who it means the most for are the poor school systems that don’t have the capacity to go out to the market for their own money, so they will get a little bit out of this,” Mackey said.
Education entities can use the money for construction projects and repairs on their campuses. The bond issue was a priority this year for Gov. Kay Ivey.
Ivey proposed a more than $1 billion bond for schools during her 2020 State of the State address before the legislative session, and lawmakers increased that amount to $1.25 billion.
“Thanks to the Legislature acting on that call, the Alabama Public School and College Authority issued $1.48 billion in bonds to provide funds for capital improvement projects for Alabama’s K-12 schools, community colleges, and institutions of higher education and to refund and retire outstanding obligations of the Authority,” Ivey said. “The Authority realized $27 million in aggregate debt service savings by refunding and retiring outstanding obligations.”
Besides issuing the $1.25 billion in new bonds, the state is refinancing about $300 million in previous bond money, saving about $24 million, said Finance Director Kelly Butler.
The interest rate on the $1.25 billion is 2.17% over 20 years.
“That’s outstanding,” Butler said. “This was a good day to borrow.”
Spending can wait
The total debt service on the $1.25 billion and some of the refinanced bonds is about $2 billion, according to information from Finance. The annual repayment will come from tax revenues into the Education Trust Fund.
The legislation allowing the bonds was sponsored by Sen. Arthur Orr, R-Decatur.
“Because the interest rates are so low, the timing is excellent for the state to take advantage of this opportunity,” Orr said. “There are many school systems across the state that are desperate for capital improvement funding.”
Orr said systems don’t have to spend the money right away.
“Fortunately, they will have several years until they have to put the money to use because building costs are marginally inflated at the present time,” he said.
Orr said the state has retired a substantial amount of debt in recent years.
“We had the capacity to take on this bond issue,” he said.
Mackey said that while K-12’s share of the new bond issue is just under $1 billion, that money will be spread among more than 1,600 schools.
“So, it does not mean that you’re going to see brand new campuses going up all over the place,” Mackey said. “What you’re going to see are roofing projects, classroom additions. I’ve talked to some superintendents that will use it on a new building, but it won’t be enough to do the building itself, they’re combining it with some local capacity to do it.
“Mostly, what it’s going to do is help us get over the top with some long-needed classroom expansions or repairs like roofing repairs.”
Butler said schools and universities can now start working on their projects. They must be approved by the Finance Department.
“They can start that process, if they’re ready, (today),” Butler said.