State funds tight for furnishing schools

The Sisters School Board is getting a little nervous about how much money the district will receive from the state to pay for furniture and other equipment for the new high school and the remodeled former high school that has become a middle school.

Last spring, the board accepted then-Superintendent Steve Swisher's estimate that the state would give the district an amount equal to at least 4 percent of the $21 million cost of the two projects.

It now appears that a first round of funding may be only a little more than half that amount.

The money would come from a special fund created by the Legislature several years ago to subsidize the cost of "fixtures, furnishings and equipment" (FF&E) in new school buildings.

The law actually authorizes payments of up to 8 percent of a building's cost. But in recent times, state education budget cuts have left average FF&E payments well below that level. That's why Swisher said he was being conservative in estimating an allocation of about half the maximum allowable.

Based on that estimate, the board negotiated a three-year line of credit with Bank of the Cascades for $844,000 to furnish and equip the two schools. This was necessary because the equipment had to be bought before the schools opened this fall while the state funding would not be received until later.

Schools eligible for FF&E money in 2003-05 will receive a payment in March 2004, with an additional amount possible in May 2005, near the end of the biennium.

District Business Manager Diane Shelly told the board at its meeting Monday, September 15 that an Oregon Department of Education representative had recently estimated that the payments coming in March would average only 2.65 percent of the cost of affected projects.

But Shelly assured the board that a better estimate would be available within a month.

In a later interview, Shelly said the district has been hoping to receive a full 4 percent of its project's cost from the state next March, and possibly an additional amount in May 2005. But she said information has become available that will soon make it possible to get a clearer and firmer idea of what can actually be expected next March.

Even if the FF&E payment falls short of the hoped-for 4 percent, there would be a possibility that a supplementary payment in May 2005 would bring the total up to that level.

And in the meantime, the district has two possible cushions to fall back on.

For the time being it still has its low-interest loan from the bank.

And in coming months it hopes to have proceeds from the sale of the former Lundgren Mill property, 29.5 acres of surplus land that the district recently put on the market (The Nugget, September 3). If the board gets its asking price of $100,000 an acre, it will receive $2,950,000 from the sale.

And as Shelly pointed out, in a March 2001 resolution on the disposition of sale proceeds, the board declared that the money would be used "to pay for the repairs and upgrades needed at the current high school" as well as "to purchase school furniture, equipment and other items not covered by the bond that are needed to equip the new (high) school."

"So if worse comes to worst," Shelly explained, "we'll still have some funds available for that purpose."