Above: The Town Council discusses the different options.
The Town Council voted 3-2 to approve a school bond referendum cap of $180 million during a special session Monday. The panel needs to submit legislation to the General Assembly now if it is to be approved this session and a bond referendum put before voters this fall.
The actual amount that would go on the bond referendum will not be decided – again by the Town Council – until early August. The $180 million number, if the General Assembly approves the legislation, is the maximum the town could seek to bond under this authorization.
Council President Mark Schwager, Vice President Mike Donegan and Councilor Caryn Corenthal all voted in favor of the $180 million cap; councilors Renu Englehart and Michael Zarrella voted against, preferring a $150 million cap.
The $180 million is higher than had been previously entertained because of legislation being considered by the General Assembly that could boost state school construction reimbursement for East Greenwich to 60 percent or even 65 percent. Under the current reimbursement structure, East Greenwich is eligible for a maximum of 52 percent reimbursement. The increased reimbursement would lower the town’s cost on a $180 million project from $71 million (at 52 percent) to $60 million (at 60 percent) or $52 million (at 65 percent). The General Assembly will decide the fate of those higher reimbursement bills by session’s end, sometime in June.
For Schwager, Donegan and Corenthal, the vote for a $180 million cap would be doing right by local taxpayers, since more of the financial burden of the project would be borne by the state.
“Let’s be honest … we’ve never had the state say they’d pay 65 percent for [what] we need,” said Donegan Monday night. “It’s not like the need isn’t there. So it’s really just how do we do the best for the taxpayers.”
Englehart said she wasn’t comfortable with a $180 million cap partly because the highest number that’s been talked about at the School Building Committee meetings up to now has been $150 million, which she said seemed like a huge amount already. And partly because she would want to reserve some borrowing capacity for municipal projects.
“Just because we have the ability to borrow more doesn’t mean we should,” said Englehart. “Why not take those savings, if it does miraculously come in at 65 percent reimbursement … [and] just use that additional borrowing power on the town side?”
She was referring to the savings the town would receive on a $150 million project with a 65 percent reimbursement rate – the town would be on the hook for $71 million at the current top reimbursement rate of 52 percent; that number would drop to $52 million if the state increased to 65 percent reimbursement.
For Michael Zarrella, the issue was mainly over messaging and a concern that approving such a high cap would turn off voters before a proposal was even completed.
“I’m worried about people making up their minds now,” he said, noting that the worst outcome would be for a school bond referendum to fail. There is precedent for that in East Greenwich; the first Cole Middle School bond failed.
Schwager said voters would remember the bond referendum number, not the cap. That bond referendum number will not be decided until early August, when a construction plan is finalized and has been approved by both the School Committee and the Town Council. (The advisory School Building Committee voted Tuesday, April 4, to pursue an option with two 1-5 schools along with a PK-K school and renovations to the high school, moving the overall project forward but with a significant number of details still needing to be ironed out.)
Donegan stressed a $180 million cap would keep options open while not obligating the Town Council to approve anything it didn’t support.
“It’s not just a blank check to use anywhere, it’s got to be a real proposal,” said Donegan. “We haven’t seen a proposal yet.”
“This is a one-time unbelievable offer. I think we would be foolish not to take advantage of it,” said Corenthal, referring to the potential for higher reimbursements. “It’s free money. Somebody’s going to get it, why shouldn’t it be us?”
Find all the school construction stories HERE.