Mehlville School District eyes $750,000 loan to meet payroll
The Mehlville School District may have to apply for a $750,000 loan with Midwest BankCentre so it can pay its employees during winter break, while it continues to wait for substantial property tax payments from the county.
Board members were scheduled to consider authorizing Randy Charles, the district's assistant superintendent of finance and chief financial officer, to execute this year's sixth loan in the form of tax anticipation notes during a meeting Monday night — after the Call went to press.
If the board approved this loan and it is executed, Mehlville would have borrowed $11.75 million in tax anticipation notes in 2003, an unprecedented amount.
The $750,000 loan could be necessary to help fund payroll costs while the district waits for county property tax payments, which have been delayed because the county currently is calculating four new tax rates and adjusting to a new computer system.
These adjustments caused tax bills to be sent out two weeks late in November.
Charles requested board members to consider another loan once he discovered Dec. 11 that the county only had sent one $1,075,491 check.
Earlier this month, Charles had reported to board members the district expected to receive a $2.4 million payment, even in the worst-case scenario.
The district also only received one $1,101,733 check this November, but had expected to receive $4 million.
The district typically expects to receive $18 million in multiple property tax payments by the end of December, but by 2003 it's possible the district only will have received a little more than $2 million.
The county collector's office recently notified Charles that the district can expect another larger payment during the week of Dec. 22.
Still, Charles told board President Cindy Christopher during an interview with the Call that another round of tax anticipation notes should be considered.
"If we didn't receive any more money this month, even the notes you've already approved would be insufficient to cover the Jan. 2 payroll," Charles told Christopher.
Including all six different loans, the district expects to have to pay $53,337 in interest charges.
Superintendent Tim Ricker recently sent a letter to County Executive Charlie Dooley, at the board's direction, requesting the county reimburse the district for incurred interest on loans it has executed while waiting on payments from the county.
"The thing that probably hits hard, too, is if we'd had better communication from the county we could have borrowed more money from the advanced funding program with the state," Christopher told the Call. "We never had that opportunity."
Also, the district is losing revenue in interest while its money sits in county accounts. Mehlville will lose $8,100 in interest, with the rest of its payment not arriving in district accounts until late December.
The letter to Dooley also requests some form of reimbursement for the funds the county will lose on interest from its own accounts.
At the Call's press time, the district had received no response from Dooley.
In another matter, board members were scheduled to consider finalized bids for Oakville Middle School renovations that will place total Proposition P costs for the school at $2,866,471, which is $198,383 over budget.
Voters approved a 49-cent tax levy in November 2000 to fund Proposition P, a districtwide building improvement then estimated to cost nearly $68.4 million.
However, the board revised the Proposition P budget in September and now projects the districtwide building improvement program will cost $86.7 million.
Total summer construction for Oakville Middle currently is estimated at $1,209,042.
Finalized bids actually came in more over budget than $193,383, but the district qualified for a $102,752 loan from the Missouri Department of Natural Resources.
The department, which offers loans to governmental entities that participate in energy efficient projects, will reimburse the district for purchasing new energy efficient boilers for Oakville Middle.
The new hot water boilers will eliminate the need to purchase a steam heat exchanger, costing the district less money in utilities. The loan will pay for itself in energy savings over a period of years, according to the DNR.
Jim Ulkus of McCarthy Construction, which serves as Proposition P construction manager, is recommending the district employ:
• Haberberger Inc. for air conditioning work, which submitted the only bid of $753,000.
• K&F Electric for electric work, which submitted the lowest of five bids, $73,300.
• Johnson Controls Inc., which has contracted with the district in every single instance of control work, submitted the only bid of $203,401.
District documents also indicate that McCarthy Construction estimates chillers for the air conditioning units will cost $58,751, while rooftop units will cost $41,494.
Also the district will include a 7 percent contingency for the project that will total $79,096.
In another matter, board members were scheduled to review board meeting dates.
Traditionally, the board has met on Monday evenings, but voted this summer to begin meeting on Thursday evenings to give board members and the public more time to review support documentation that is prepared for each board meeting and not available until the Friday before board meetings.
However, Christopher told the Call that some scheduling conflicts have become apparent.
Board member Richard Huddleston recently informed Christopher that he has a weekly Thursday evening work commitment that would make it impossible for him to attend board meetings. Also, board Vice President Matt Chellis informed Christopher earlier this fall that he has a Monday evening commitment that would make it impossible for him to attend board meetings if they were moved back to Mondays.
If both of those commitments are honored, the board was left with meeting on Tuesdays and Wednesdays.
Board members also were scheduled Dec. 15 to:
• Consider the 2002-2003 audit.
• Approve the 2004-2005 and 2005-2006 calendars.
• Set a date to conduct in closed session an evaluation of the superintendent's performance.