Renovations could cost $63M

By Jaime North
The Danville News

May 29, 2008 08:16 am

— DANVILLE -- Keeping the neighborhood elementary schools intact could cost the Danville school district $63 million over the life of the loan needed to pay for the most expensive option, according to Kim Schooley, Montour County treasurer.
Schooley pleaded with the school board Tuesday to pursue a consolidation plan since those options offered annual cost savings that could help pay back debt much faster. He estimated between $13 million to $38 million could be saved by building a new $28 million consolidated school based on its projected annual cost savings.
Schooley presented four options of what it would cost to build the consolidated school in comparison to renovating the three schools, which he estimated would cost between $35 million and $42 million. He based the figures on loan rates (4.25 percent) at 20 and 30 years.
"These are the real costs we should be talking about," Schooley said. "If we have a consolidated school, it's much more financially feasible. That means less teachers and less utilities costs. It just makes more sense."
According to Schooley's estimates, pursuing a $35 million renovation option would cost the district $52 million over a 20-year loan at a three percent inflation rate. The annual debt service would be $2.6 million.
Pursuing a $42 million renovation option would cost $62 million over a 20-year loan, including an annual debt service of $3.1 million, according to his estimates. Each option would incur $10 million more over the life of a 30-year loan.
Schooley estimated it would cost the district between $21.5 million and $28.2 million to build a consolidated school based on a 20-year loan agreement. The annual debt service would be $2.1 million, as the district would receive an estimated $500,000 to $800,000 in annual savings.
The consolidated school would cost between $11.5 million and $25.8 million over a 30-year loan, including an annual debt service of $1.7 million because of the annual savings, Schooley estimated.
The most expensive renovation option would cost $63 million more than the consolidation plan over a 30-year loan agreement, according to Schooley.
"The scary thing is I used really conservative numbers," Schooley said. "That's something to think about."
E-mail comments to jnorth@thedanvillenews.com.