Fiscally Option 3 is better choice!

I’ve heard it said that the “Overall” price for Cawley and Downtown is the same “less the city contribution”! HELLO that is the biggest challenge this city faces. These are the original estimates for both sites.

LHS Add/ Reno Option # 3 – Total Cost $ 334,335,971
City Contribution $ 126,417,978

New School Cawley Site – Total Cost $ 332,458,871
City Contribution $ 148,341,142

That’s $21,923,164 more for the Cawley site for the taxpayers of Lowell to provide. It is largely because of the needed site work.

Back in March based on the current 4 selections and then estimated cost , the Manager’s Office provided the following information about debt service or what the cost per year for the City’s portion of the project would be. This is BEFORE the cost of Field replication , sidewalks or busing is taken into consideration.

The annual debt service costs for the four options approved by the City Council are $7.49 million for Full Renovation, $8.72 million for Add/Reno Option 2, $8.13 million for Add/Reno Option 3, and $9.54 million for New School/ Cawley Site.

That is a $1.41 Million dollar a year difference.

The City of Lowell could use that difference towards the Operational budgets of BOTH the City and the School Department.

The tax increase necessary to meet the funding requirements for the four high school options would be approximately 6%,7%, 6.5%, or 7.7%, respectively.

To me the next statements the Manager supplied are the most important – Any additional funding needs for the annual operating budget for fixed costs, additional debt service for capital improvements for curb appeal and infrastructure investment, or any other budgetary needs of the city, would be in excess of the those tax increases.

Lowell cannot raise taxes to pay for the most expensive site and still be able to provide full services from the city and in the city schools. We cannot tax ourselves out of attracting new businesses.

Lowell has a split tax rate Residential/Commercial. The current commercial rate is $30.62 that is before the proposed 1.5% 2018 tax levy increase. Taxes for a new LHS will increase commercial rates already. Cawley based on the original estimates is $87.01 – $365.43 more a year for commercial property owners. Not Exactly a selling point to attract new businesses. and that is before whatever the yearly property tax increases.

As of FY2017, Lowell’s excess levy capacity is Approx $16,674,500.
This amount represents that additional amount of taxes that Lowell could—but chose not to—levy. This is why we can build a High School without a Tax Override or Debt Exclusion.

Presently , the School Department is projected to receive approx $144,679,262 from Chapt. 70 State funding. $6,090,881 more from the State than last fiscal year. I hear they are still looking for another $100,000 from the City.

The City already increased their initial cash contribution this year, to $18,263,584 up from the original $18,005,691 bringing the Lowell Public School Operating Budget to $162,942,846 or $869,522.00 more than originally presented to the School Committee when the budget was released May 10th.

Of the city’s $18,263,584 cash contribution, $9,043,069 is used for Transportation which reduces the actual cash contribution. The State Law for reasons beyond common sense, does not count Adult Education towards Net School spending and that amount $500,011 also get deducted from the cash contribution.

The cash contribution of $18,263,584 is really only $8,720,504 after those two deductions Where is there room for High School busing without totally rezoning the city and changing start times in most middle and elementary schools? and were is there fiscal room to address the middle school crunch we keep hearing about?

A city with an operational budget of $349,925,167.00 can only afford to provide their school department slightly over 2.5% in cash contributions (Approx. 5% if you include Transportation and Adult Ed) that’s NOT a lot of money.

There is no more cash (or presently very little) to provide more funding. The other School Committee candidates who are all from Citizens for Cawley are also advocates for High School busing yet none of them have presented a plan to be able to fund it without a massive drastic change in starting and ending times for 10,000 students (including LHS which moves its start time 45 minutes earlier).

Not only is the City already using $2,000,000 in reserves to fund the budget but because of the OPEB – Other Post Employment Benefits responsibility, we find out that the city’s liability exceeds its assets. This information is in the 2016 Financial Statement (page 4)

Basic Financial State 2016

Basic Financial State 2016
The City’s liabilities and deferred inflows of resources exceeded its assets and deferred outflows of resources at the close of 2016 by $29.4 million. The decrease is primarily the result of the recognition of pension and other postemployment liabilities. • Governmental net position decreased by $28.4 million. The decrease is attributable to the $53.8 million increase in the net pension liability, a $13.2 million increase in the other postemployment benefits (OPEB) liability, offset by a net increase in deferred outflows/(inflows) related to pensions of $43.9 million, and the recognition of $2.1 million of capital grants. • Business-type activities experienced a combined $1.2 million decrease in net position.

The State of MA. presently is $462 million below projections in revenue for fiscal year 2017 and yet still are relying on 4.1% forecasted increase in revenue for 2018. This despite the Governor cutting $98 Million dollars last December because of revenue shortfalls.

The fiscal out look is very tight, the Hamilton Canal will not provide “New Growth” any time soon and the City can’t spend all the available resources for the Cawley site.

Lowell because of the large amount of low income families we have, participates in the CEP (Community Eligibility Provision) program providing free breakfast and lunch to every school student. I advocated for that to provide not only a decent breakfast for low income families but assistance to middle class working families who generally don’t receive any assistance and live paycheck to paycheck. We cannot tax these families out of Lowell. We are a known city of immigrants, taxing the poorest out and creating gentrification to justify the cost of a new LHS shouldn’t be on Lowell’s mind.

I also think that a large number of LHS students do use the City Library , UTEC , Girls Inc., CTI , Health Center and many other Social Service agencies that are downtown or near enough to walk to after school. My own daughter and her friends like to go over to the Library – Brew’d Awakening or Mill Five after school. How do they access these locations after school?

There is NO guarantee and NO LEGAL REQUIREMENT TO PROVIDE BUSING TO LHS NO MATTER WHERE IT GETS LOCATED! (BARRING A LAWSUIT) and if the state or city gets into a worse fiscal situation there is no guarantee that a future school committee doesn’t cut high school transportation regardless where the High School is located.

The City failed to do their due diligence in being aware of the Article 97 restrictions, it in my view has made this site no longer realistic. I liked the original plan for Cawley but the more roadblocks that came up, the more expensive it became. We are now looking at a 5 story building surrounded by parking. It is not the campus setting it started out to be, the increased cost of busing and the possibility of having to change the starting and ending time of 10,000 students (including LHS itself) make it more unattractive. When you add in the additional traffic congestion that the Cawley location causes (in my view that can’t be mitigated enough) it is another nail in the Cawley Option.

The Overall Cost – the Traffic – the increase in operational cost directly associated with busing and the fiscal state of the city and state combine to make me switch my support from Cawley to Option 3. Fiscally it makes the most sense.

I expect when we receive the final estimates next week, there will be more fiscal differences that support my opinion Option 3 is the best of the remaining options. It provides new buildings (I’d prefer to see a 4 story not 5 story building) should provide a way to schedule renovations while minimally negatively effecting students and provides some fiscal leeway to be able to fund the operational budgets of the School and City. It is the best of what some will say are the bad choices left.

There are still many battles to fight to keep Cawley alive even if chosen by the Council, we would still need the Lowell Zoning Board, Lowell Conservation Commission, Tewksbury Conservation Commission, Chelmsford Conservation Commission’s, Lowell Cemetery Commission and Board of Parks all still have to approve items related to this site. What makes anyone think every board will approve or not require further changes that increase cost?

The Dentist office can take the city to court to fight the Price being paid for the taking but my understanding is cannot delay or stop the taking from happening.

The City and School dept are already running very thin budgets, selecting the highest priced option for LHS isn’t sound fiscal practice. No one likes to take a business but Lowell has a history, has do three of these current councilor’s to take both business and residential properties for the overall benefit of the city.

Option 3 will be beneficial to the overall community for years to come without fiscally challenging the current community any harder than we have to and provides some fiscal space to be able to fund our operational budgets for the School and City.