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Home My Public Portal AboutFC sub-committee packet 9.16.20REVISED .......... DISCUSSION DRAFT EDITED 9/15/20 1 | P a g e Background on Sub-Committee 1.The Nauset Regional High School (NRHS) subcommittee of the Brewster Finance Committee was formed in December of 2019 to focus on the proposed project to renovate and expand the regional high school and provide input to the Finance Committee in its deliberations and final vote on the project as configured by the School Committee and presented to the state for approval. 2.OPrior to and subsequent to the formation of the subcommittee, the Brewster Finance Committee (FINCOM) met and attended a number of presentations held to inform all stakeholders in the project including: A joint presentation by the NRHS Building Committee to FINCOM and the Select Boards on July 22, 2019 A public presentation by the NRHC Building Committee and the Project Operating Manager on August 25, 2019 A presentation made by Nauset Regional School Committee (NRSC) and NRHS Building Committee members on October 2, 2019 A public presentation made by Jack McCarthy of the MSBA on November 19, 2019 A presentation to FINCOM by NRS Committee members Chris Easley and Jim O’Leary on December 2, 2019 A joint presentation by the NRHS Building committee to FINCOM and Select Board on January 20, 2020. The subcommittee met with members of the NRHS Building Committee and the finance staff of Nauset Regional School Administration on two occasions in October and November 2019. The subcommittee has met six times since its formation in December 2019. 3.Once the full range of considerations is addressed, the key decision that needs to be made is whether the project proposed by the Nauset Regional High School Committee is worthy of Brewster FINCOM and taxpayer support. 1. Current State of NRHS 2.4.The current NRHS is 50 years old and requires substantial work on its infrastructure. 3.5.Only one major project has been done since it was originally constructed. 4.6.It is not fully compliant with the American Disabilities Act (ADA) and has other code violations. Project Size and Scope Formatted: Font: Bold Formatted: Highlight Formatted: Bulleted + Level: 1 + Aligned at: 0.13" + Indent at: 0.38" Commented [HP1]: Recommend including as appendix – while informative but not an essential element of summary Formatted: Highlight Formatted: Font: Not Bold, Highlight Formatted: Indent: Left: 0.38", No bullets or numbering REVISED .......... DISCUSSION DRAFT EDITED 9/15/20 2 | P a g e 5.7.The proposed project scope involves a combination of renovation and new construction. The total project cost is $132 m. The Massachusetts School Building Authority (MSBA) has reviewed the project and committed to a contribution of $36 m. 6.8.The School Committee proposes to issue bonds for some period of time (20 to 30 years) to fund $98 m IF voters in the region/district approve the project and thereby agree to fund the debt.(APPENDIX 1 – CHART PREPARED BY R. YOUNG FOR SELECT BOARD 20, 25, 30 YEAR SCENARIOS) 7.9.All funding for the bonds or debt service would be the responsibility of taxpayers in the towns forming the region/district. 8.10.Taxpayers who are currently legally bound by their respective Select Boards to participate in the Nauset region/district are those residing in Brewster, Orleans, Wellfleet and Eastham. 9.11.These taxpayers will have the opportunity to vote on whether or not to approve the NRHS project as approved by MSBA when it is presented in Town Meeting and on ballot in Spring of 2021. 10.12.The project as proposed and designed is the ONLYonly option for voters to consider at the Spring 2021 town meeting and ballot.. 11.The project is sized for 905 students. 12.All work done by the design team and the resulting project is based on the decision in 2017 by the School Committee to proceed with a project sized for 905 students. 13.TThis maximum student enrollment approved by the figure of 905 students has been accepted by the MMSBA as the basis for the project is 905.. (APPENDIX 2 – MEMO BY F. BRIDGES REGARDING NAUSET REGIONAL SCHOOL COMMITTEE ENROLLMENT DECISION) 14.The Superintendent has strongly supported the need for a school population this size as critical to robust programming, diversity, and essential for effective recruitment and utilization of full-time teachers. Student Utilization of NRHS 15.Actual student volume at NRHS for FY 2020 was as follows: Brewster*281 31% Eastham, Wellfleet, and Orleans* 335 36% Provincetown and Truro 86 9% CHOICE – other towns 219 24% Total 921 100% *4 TOWNS IN DISTRICT = 67% OF STUDENT VOLUME Formatted: Font: Italic Formatted: Font: Bold Formatted: Font: Italic Formatted: Font: Italic Formatted: No underline Formatted: No underline Formatted: No underline Formatted: No underline Formatted: No underline Formatted: No underline Formatted: No underline Formatted: Font: 11 pt, Italic, No underline REVISED .......... DISCUSSION DRAFT EDITED 9/15/20 3 | P a g e 16.Enrollment from the 4 towns in the region/district has declined from 800 to 616 students or 23% in the last ten years (2010 to 2020). 17.For the same ten-year period, CHOICE enrollment has increased from 153 to 219 students or from 15% to 24% of the total student population. 18.The MSBA performed a demographic study supporting the enrollment figure including an expectation a 1% decline per year for students within the district. 19.The MSBA data shows a 4-1/2% decline in the student population between 2017 and the end of construction in 2025. 18.We cannot determine the impact on enrollment of the This ten-year period is only just beginning to reflect the increase in students related to multiple affordable housing initiatives across the 4 towns in the region/district. In Brewster the Habitat for Humanity community has added families with children to the town’s student population. The Millstone project will also likely add students. 20. 19.21.Eastham and Orleans have similar projects that will coming online. Financial Considerations 22.The School Committee makes a decision each year whether to continue the CHOICE program and the number of students to accept in each grade. 20.accept students from towns other than the 4 towns in the region/district and under what financial arrangements for operating, capital and debt service costs as well as how transportation is to be funded. 21.23.Of the four towns in the Nauset regional system, Brewster funds the largest percentage of NRHS costs at nearly half based on the percentage of its student enrollment the prior year in relation to the other 3 towns (see #15 for chart 281/616=47%).. 22.24.As a result, Brewster would be obligated for nearly $50 m of the project debt service of $98 m if the project is approved. 23.25.The project impacts taxpayers in three ways: operating budgets, capital budgets and debt service. 26.A five-year agreement executed in April 2019 exists with the towns of Provincetown and Truro in which the two towns agree to pay $18,457 per student (flat fee) in agreements expire at the end of school year 2024. This flat fee is increased by 2-1/2% for the first four years and 3-1/2 % in the final year. 24.27.a portion of annual operating costs as tuition and make some contribution to capital. The agreement does not require full operating costs or full portion of capital costs nor does it include any obligation to fund debt service on any major projects including this project. 25.28.CHOICE students are students from towns throughout MA who choose and are accepted to attend the Nauset Regional School DistrictNRHS. The state law effectively limits annual Commented [HP2]: Recommend we insert chart I developed from Bob’s original data set; it highlights the changes in budget per enrollment and composition of enrollment – more impact than 16 and 17 alone Commented [RY3]: I’m pretty certain this doesn’t exist today – and what elected official from these two towns would ever suggest joining the district or otherwise contributing to the capital/debt service of a school that’s already been constructed? My understanding from our conversations with the administration and NRSC officials is that they’re concerned they would send their kids to Monomoy. REVISED .......... DISCUSSION DRAFT EDITED 9/15/20 4 | P a g e operating budget reimbursement from the town of residence to the lower of the sending district’s annual cost per student or $5k whichever is lower. The state law does not require the sending district to fund capital costs or debt service for major projects. 26.29.State law does stipulate some additional payment for costs associated with Choice students with special education needsstudents. 27.30.The State law regarding financing/reimbursement for costs related to of CHOICE students known as the inter-district school choice has not changed since its inception in 1991. 28.31.Although not required under the state law, the district provides tTransportation for CHOICE students. The district does not provide transportation for tuition students from Provincetown and Truro. is expected to be provided by the student’s guardian(s). 29.32.In an March 2020 memo, the district superintendent NRHS reports receivinges $5,800 in operating revenues on average for CHOICE students representing a deficit per student in operating costs of $14,90023,200 ($20,700 - 9k-$$5,800). 30.33.In total for FY 2018, the district NRHS reported receiving gross reimbursement/revenues of received $1.58 m for the high school in additional reimbursements/revenues this past year from CHOICE students.. 31.34.The five-year agreement with Provincetown and Truro requires payment of approximately $2,243 less $($20,700-$18,457) than the actual cost per student.4k less than the average cost per student and $11k less than the district taxpayers. 32.Reimbursement for CHOICE students is $17k less than the average and $24k less than the district taxpayers must pay. 33.35.Taxpayers from the 4 towns in the region/district pay nearly $25,9009k per sdistrict student per year in operating costs. The overall cost/student is about $20,7002k. District taxpayers are therefore paying $5,200 7k or 2532% more per student than the average cost to subsidize unfunded costs for students from Provincetown and Truro as well as CHOICE students. 34.36.Over the last ten years (2010 to 2020), the NRHS budget did not request increases to its operating budget more than 2.5% per year. 35.37.During this same 10-year period, total enrollment has decreased 7% and the total NRHS budget has increased 29%. This translates to budgeted costs per enrolled student has increasinged 39% during the is period, and with CHOICE students increasing from 15% to 24% of the total student population. (APPENDIX 3- SEE CCHART TITLED #___ ________) Other Considerations 38.The School Committee has not decided the term of the financing (20, 25 or 30 years). 39.The Select Board in Brewster has recommended 20 years. Formatted: Not Highlight Commented [RY4]: I believe NRSD provides buses in various places around the Cape to facilitate this (at no cost to the families or state) Commented [RY5]: I’d specify – FY2018? FY 2019? Commented [RY6]: same Formatted: Font: Italic REVISED .......... DISCUSSION DRAFT EDITED 9/15/20 5 | P a g e 36.40.The total annual property tax increase to Brewster taxpayers for the project, inclusive of the subsidy for students from Provincetown and Truro as well as CHOICE students, has not published at this time and cannot be published until the School Committee votes on the term for the debt. 37.41.Market iInterest rates are expected to be lower than those included in the project estimate. 38.1.The School Committee has not decided the term of the financing (20, 25 or 30 years). 39.The Select Board in Brewster has recommended 20 years. 42.Taxpayers have to choose between approving this project and paying a subsidy for unfunded costs associated with students who are not from the 4 towns in the region/district OR rejecting the project knowing there is a risk that an alternate project could be presented for which the state refuses to provide funding shifting the burden for 100% of the costs to the taxpayers. 43.If the current proposal is defeated and an alternate project is undertaken that eliminates and/or substantially reduces CHOICE and/or Provincetown/Truro student enrollment, the approximately $3.6 million/year in operating cost savings from educating fewer students could effectively be used to fund the four district towns debt service costs for this alternate project. Assuming a 30-year bond term at a 2.5% interest rate, this $3.6 million/year redirection of funds would support $105 million in debt. When combined with any MSBA support could fund the entire alternate building project with zero property tax increase versus today. (Appendix 4 – Memo dated ________to _____ prepared by R. Young) 40. 44.It is not clear if the current project design approved for NRHS by MSBA contains sufficient flexibility to address any substantial changes necessary to meet student/teacher needs arising from COVID 19. Such changes might include use of remote learning as well as in person learning, the size of classrooms and airflow systems including windows that open to respond to the highly infectious nature of this virus.The proposed schematic design was approved by the MSBA in August 2019 and complies with current building and accessibility codes. The onset and continued expansion of the pandemic creates two fundamental challenges for the project: It is not clear if the MSBA approval provides sufficient flexibility to incorporate design modifications necessary to meet new student/teacher needs arising from COVID 19. Such changes might include use of remote learning labs to supplement in-person learning , a change in the size and design of “in-person” classrooms, increased use of automation and “touchless technology” to replace manual systems (doors, light switches, temperature controls), the use of anti-bacterial materials and finishes, the addition of low density and one way student access and egress flow patterns and high efficiency/output airflow systems to respond to the highly infectious nature of this virus. Formatted: Font: Italic Formatted: Font: Italic Formatted: Bulleted + Level: 1 + Aligned at: 0.13" + Indent at: 0.38" Formatted: Font: Italic REVISED .......... DISCUSSION DRAFT EDITED 9/15/20 6 | P a g e It is not unreasonable to expect that school design and building codes will change in the near future. School population sizes, newly designated high-risk activities (arrivals, assemblies, lunch, group-based activities and departures) will all need to be examined. 41. Formatted: Font: Italic Formatted: Indent: Left: 0.38", No bullets or numbering DISCUSSION DRAFT TEN YEARS OF KEY STATISTICS AND CHANGES FOR NAUSET REGIONAL HIGH SCHOOL 1 2 3 4 5 6 7 8 NRHS Budget (excludes Region, other expenses) NRHS BUDGET PER ENROLLMENT TOTAL NRHS ENROLLMENT Total NRHS 4 member towns enrollment Total NRHS member towns + tuition enrollment Total CHOICE enrollment 4 Member Towns as a % of TOTAL ENROLLMENT Provincetown and Truro Tuition as a % of TOTAL ENROLLMENT CHOICE as a% of TOTAL ENROLLMENT FY10 (09/10)$9,126,011 $9,190 993 800 840 153 81%4%15% FY11 $9,059,459 $9,179 987 737 819 168 75%8%17% FY12 $9,436,281 $9,779 965 696 780 185 72%9%19% FY13 $9,725,011 $10,026 970 695 780 190 72%9%20% FY14 $10,250,107 $10,010 1024 706 810 214 69%10%21% FY15 $10,730,685 $11,017 974 687 777 197 71%9%20% FY16 $10,968,281 $11,181 981 676 772 209 69%10%21% FY17 $11,131,812 $11,780 945 642 734 211 68%10%22% FY18 $11,086,421 $11,998 924 603 688 236 65%9%26% FY19 $11,468,531 $12,149 944 624 716 228 66%10%24% FY20 $11,781,018 $12,792 921 616 702 219 67%9%24% CAGR 2.59%-0.75%-2.58%-1.78%3.65% % change FY10-FY20 29%39%-7%-23%-16%43% AVERAGE PER YEAR 3%4%-1%-2%-2%4% NEED TO INSERT DATA SOURCES FOR THE FIGURES IN EACH COLUMN OBSERVATIONS: Total budget increased 29% over 10 years ......... or an average of 3% per year. Budget per student increased 39% over 10 years .....or an average of 4% per year; student enrollment has decreased an average of 1% per year. Average enrollment from 4 towns in district and tuition towns (Ptown and Truro) decreased 2% each year; CHOICE increased an average of 4% per year. Enrollment in 2020 is comprised of 67% youth from region and 33% outside the district (9% Ptown/Truro + 24% CHOICE). N:\Board of Selectmen\E Packets\FinCom\09.15.2020\Change in budget vs change in enrollment HP ADD.xlsx 9/15/2020, 4:00 PM Prepared by: BY; edited by: HP