Let’s pick some numbers: Suppose that a substantial Angier renovation and addition costs $25 million, somewhat less than a new building that could run to $35 million by 2013. Suppose that Carr can be renovated into swing space for $7 million, or a million less than the “wish list” renovation currently being proposed. This brings us to $32 million in funding need.
I don’t know the present MSBA reimbursement rate, but let’s call it 50%. The state then picks up $16 million in Angier/Carr cost, and Newton pays the other $16 million. If there is no debt exclusion, we’ll borrow the money and pay back the debt service from our annual operating budget.
If the cost to borrow is at the same rate as the debt service on this year’s Modulars/Day money, we’ll have to divert $1.44 million annually from, say, teacher pay. If each new teacher costs the City $70,000 in total compensation, this $1.44 million will pay for 20 new teachers, or enough to staff an entire elementary school.
This is the consequence of school building construction without a new revenue source. Assuming that we are not ready to begin to draw down funds for construction during FY12-13, the Mayor’s decision to keep a DE off of the ballot in 2012 may not hurt. But when we are ready to spend, using operating funds to do so will have deep, deep impacts, as we can see from the $6 million in annual debt service our operating budget is now paying for NNHS debt service.