By MARINA WATERS
A year ago, the plan to turn the current Jonesborough Elementary School site into a K-8 school and the current Jonesborough Middle School site into an academic magnet school seemed to be up ahead. Now, after newly drafted design plans and numerous split votes on design options from the school board, the Washington County Budget Committee weighed what the future of the project could mean for the county’s financial plan.
Eldridge said that while the latest report from Moody’s Public Finance Group said that the current debt level for the county is in better shape than that of the U.S. median, in the future, that could be subject to change.
“I say that specifically with the things that are potentially on the horizon,” Eldridge said. “Increasing that debt level without a corresponding increase in property values is somewhat problematic.”
Commissioner Lynn Hodge asked how much the Jonesborough School project, which is yet to be officially finalized, could effect the county’s interest rates and credit.
“I think where it would hurt us is if we had to amend our policy,” Eldridge said. “The county commission was very deliberate a few years ago in setting limits on the amount of debt that we were willing to take on and they were very responsible in that, but I think, and this goes back to my days of dealing with Wall Street years ago, I know we got hurt much more when we violated our own policy or missed our own projections.
“In this situation, I think the challenge would be to exceed what we said we were willing to do.”
Eldridge said the project could require an additional $40 million for the county to take on in debt, which would put the county over the $200 million debt mark.
“It takes us to the limit,” Eldridge said. “From my perspective, worst case scenario would be to exceed the amount of borrowing the commission has established. And the higher the interest rates go, the more expensive the borrowing is and you may not exceed that threshold of net borrowing, but it’s driving your borrowing costs and your annual debt service. That means you move more pennies, which means you have to borrow more debt.”
Commissioner and Budget Chairman Joe Grandy added that the longer the Jonesborough School project is delayed, the less money the BOE could have to work with, as interest rates are projected to go up.
New administration is also on the horizon in the county, which could be a factor for the project. Eldridge, who is not seeking reelection this year as the county mayor, said a new school for Jonesborough isn’t a possibility, unless the future mayor and county commissioners opt for another tax increase.
“I’ve heard these comments of, ‘We’re just going to wait for new administration and they will build us a new school,’” Eldridge said. “If a new administration can convince eight county commissioners to raise taxes again, then it will be possible to build a new school. Without a tax increase, it is just not possible. It’s unfortunate that people are being told things like that because it misinforms the public.
“At this point, I don’t think they know what to believe.”