By Marsha Sutton
Bond issues pertaining to improvements at Torrey Pines High School and at schools districtwide were passed by the San Dieguito Union High School District’s Board of Education on March 1.
With the school board’s approval to issue $2 million in lease revenue bonds for Torrey Pines, three projects will move forward. Two projects will replace heating, ventilation and air conditioning units and provide roof repair at one building for $450,000 and at another for $302,000.
The third project is the replacement of the synthetic field at TPHS for a cost of $1.25 million.
The bonds would have an eight-year term with interest-only payments in the first three years, after which level interest and principal payments would be made. Unlike General Obligation bonds which are backed up by special taxes on property owners, “the ultimate backstop for lease revenue bonds is the district’s general fund,” according to the agenda report.
The total principal amount of the bonds would be $2.5 million, with about $2 million available for the projects. After including various funding sources, the estimated cost to the district to issue the bonds is about $200,000.
Eric Dill, SDUHSD’s associate superintendent of business services, told the board the principal payments would be deferred for three years, at which time the district would need to recognize this liability. However, if San Dieguito is successful in passing a General Obligation bond in November, then GO bond proceeds could be used instead of dollars from the general fund to pay off the lease revenue bonds, according to the board report.
The immediate need to replace the Torrey Pines field was a blow for the district. Dill said the lifespan of the field was estimated to be eight to 10 years. It is now in its 10th year and beyond the warranty period.
Board member John Salazar said that paying $200,000 in upfront costs “seems enormously expensive.” Dill agreed, saying this was not “the preferable way of funding,” but the district had little choice.
Although SDUHSD is considering asking voters to approve a GO bond that could potentially pay for this work the following year, Dill said the district could not wait another year to fix the field. He said the field is not safe, and the district risks incurring liability for injuries unless the turf is replaced. He said nothing on the field “appears to be grass any more.”
Furthermore, the outcome of the GO bond – whether it will pass or even whether the school board will decide to place it on the November 2012 ballot — is uncertain.
Dill said the TPHS Foundation approved a contribution of $50,000 for the cost of the landscape architect, D.A. Hogan & Associates, “who will create the specifications and oversee the installation by the contractor.” That cost, however, is apart from the project funds approved by the board at the March 1 meeting.
The vote was unanimous, although Salazar hesitated before voting. After the meeting, in an email, he said he was initially against the lease revenue bonds “because of their outrageous upfront expenses.”