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$92 Million Approved as State’s Share of Construction Project Funding for School Districts in Arkansas

The Public Schools Facilities and Transportation Commission on Thursday approved the distribution of $92.2 million in state assistance for 58 construction projects in 45 Arkansas school districts.

Projects that will be funded in part with this state money include new school buildings in the Watson Chapel, Jacksonville/North Pulaski, Benton and Highland school districts, as well as school building additions, new roofs, new heating and air conditioning systems and new security systems.

“This is very good news,” Watson Chapel Superintendent Andrew Curry said Thursday of the $14,585,876 state aid that was approved for a 94,000 square foot campus. can accommodate up to 500 students. The district’s share of the cost would be about $8 million, which will require voter approval of a proposed property tax increase later this year or early 2023, Curry said.

The Jacksonville/North Pulaski District is expected to receive $4.7 million for the replacement of Bayou Meto Elementary and $1,789,359 for the replacement of the existing Murrell Taylor Elementary.

“It’s definitely what we expected and what we wanted,” Jacksonville Superintendent Jeremy Owoh said of the commission’s vote. “This brings us one step closer to achieving our facilities goal, which is to have new schools for all of our scholars.”

The district will seek additional state funding for the Murrell Taylor Elementary campus in the 2023-25 ​​round of state building funds. The commission will make that decision on Taylor next April, Owoh said.

The three-member state commission approved project allocations at a meeting where it was told that rising building material costs nationwide this year are affecting university-related construction projects.

Tim Cain, director of the state division of public school facilities and transportation, told the commission – chaired by Arkansas Education Secretary Johnny Key – that nonresidential construction costs and new construction costs per square foot increased 19% to 21% from December 2020 to December 2021.

The average cost per square foot of new construction during this period rose from $202.69 to $245.58, Cain said, an increase of $42.90 or 21.1%. Cain added that he had received reports in recent days of costs reaching $300 per square foot.

Districts whose state aid projects have been approved are negatively affected, he said.

“Some districts cannot continue under current conditions due to a lack of funds,” Cain said. “Several districts have reached out to me, asking for help from the state,” he also said, adding that the solutions will not be easy for the districts or the state.

Key told fellow commissioners that the state education agency doesn’t have the authority to simply increase the amount of state facility aid going to districts. Any increases would require authorization from the Legislative Assembly and the governor, he said.

Staff at the University Facilities Division, however, are preparing information on rising costs to be ready to respond to any requests from lawmakers, he said.

NEIGHBORHOOD OPTIONS

Cain offered immediate options to the districts, while ideas for longer-term solutions are in the early stages of development.

In the short term, districts could change the scope and size of their planned projects to make them more affordable, Cain said. Similarly, districts could modify the finishes and other materials they use in their buildings and/or add flexibility in the timing of project completions to meet their budgets.

Additionally, districts may be able to use federal covid-19 relief money to cover cost increases, he said.

School districts in Arkansas have received approximately $1.7 billion in this special funding, which can be used for a fairly broad list of initiatives.

“HORROR STORIES” INFLATION

Board member and chairman of the Arkansas Development Finance Authority Mark Conine said school districts that intend to raise their share of construction costs by issuing bonds will likely see higher rates. higher interest rates on bond debt. Higher interest rates reduce the money available for the actual project.

Superintendents also monitor building material inflation.

“It’s going to be a big deal because … you don’t know how much to charge your customers,” Curry said of a local tax hike to replace a campus built in the 1940s.

“I hear horror stories of $300 a square foot in northwest Arkansas,” he said, noting that in Jefferson County, a previously projected cost of $200 a square foot square could end up at $250 per square foot.

Currently, Watson Chapel District has a property tax rate of 34.1 million and the school board is considering asking voters for a 5.7 million raise to raise approximately $8.5 million for the new building. .

Owoh, the superintendent of Jacksonville, said Thursday he was glad commissioners and facilities division staff were talking about rising construction costs.

He said he hopes the state will recognize the need for districts to be able to complete their projects and, therefore, change funding amounts so that increased costs are covered.

The District of Jacksonville plans to finalize the land purchase for a new Bayou Meto Elementary in the coming days and begin construction in the fall on a 460-student campus.

Lawmakers created the Arkansas College Facilities Partnership Program — in which the state shares the cost of building college space — in 2006 to modernize public schools. This was done in response to a state Supreme Court ruling that declared Arkansas public schools unfair, inadequate, and unconstitutional.

A Partnership Program Project Agreement must be signed by a school district and the facilities division within 60 days of the board’s funding approval vote.

The project must be under construction – as evidenced by a signed contract – within 18 months of commission approval and must be completed and state reimbursement claims submitted within four years of commission.

Some of the other projects approved Thursday to receive state funding include a new college in Benton, the state’s share of which is $12.3 million.

The Jonesboro School District is set to receive $3.7 million for an addition to MacArthur Junior High. The Prairie Grove School District is approved for $1.9 million for the addition of middle schools. The Bauxite School District is to receive nearly $5.3 million in state assistance for the addition of high schools.