SHARON

Board may borrow $10 million

Sharon City School Directors Wednesday were presented with a plan to borrow $10 million for high school renovations.

Directors have already approved $8.8 million in reconstruction work, which includes a new roof, asbestos removal, heating and ventilation systems, Americans with Disabilities Act compliance work and new plumbing. The directors are deciding on another $8 million in additional and optional renovations.

Jim Tricolli, a financial analyst with Tucker Anthony Inc., Pittsburgh, said the district will need to raise taxes by about 14 mills to pay off the bond issue. The board can spread out the tax increase over three years, Tricolli said. He said it will not affect taxes until 2001.

Through a bank, a bond issue borrows money from investors for major public projects, such as schools.

The school tax assessment is 21 percent of a property’s 1970 market value. Each mill of additional tax would cost the average taxpayer $5 a year. A 14-mill increase would be about $70 spread over a possible three-year span.

Business Manager James Wolf said the state will reimburse about 33 percent of the cost of the work.

Tricolli said there are two ways for the district to reinvest the money they borrow. He said the district can invest at variable or fixed interest rates. He said he anticipates the money would earn more at a variable rate, but the district would have the opportunity to switch to a fixed rate with 30 days’ notice.

If directors take out the loan by November, at a variable rate of 4.47 percent, Tricolli said he anticipates the district could earn a total of about $60,000 on the investment. The earned money would then be put back into the reconstruction fund.

Director Pamela Corini said many of the improvements the board is considering are necessities, not aesthetics. "We’re not talking pretty here."

Wolf said the board borrowed $19 million in 1998 and ‘99 to reconstruct Musser and West Hill elementary schools. He said taxpayers saw an 11- to 12-mill increase in their taxes. The last hike for those projects was included in the current budget, he said.