Faced with a $136 million gap between the cost of desired school building repairs and available funding over the next decade, NOLA public schools should consider additional sources of capital maintenance and repair revenue, perhaps -even be a new tax, said a school district official at Orleans Parish. School Board recently.
Based on an assessment of each NOLA public school-owned facility, the district has projected that it will need approximately $336 million for repairs over the next 10 years, of which approximately one-third – $108 million dollars — will be needed in the first two years, Tiffany Delcour, director of NOLA public schools operations, told the board at a meeting Tuesday.
Capital projects are funded through the School Facilities Preservation Program, which allocates funds to schools for repairs based on student enrollment rather than need.
“A very big problem”
The district’s projected revenue from the fund over the next 10 years is $328 million, but only $199 million will be available for needed repairs due to how state law restricts the use of money, Delcour said. That leaves about $129 million in school accounts that don’t need it.
“We actually have a very big problem,” Delcour said.
The program was enshrined in state law in 2014 to ensure maintenance of buildings constructed with federal funds after Hurricane Katrina. Officials anticipated “a bubble that will burst in the next 10 to 20 years” when those buildings will all need repairs around the same time, she said.
Even if the preservation program is modified to make spending more flexible, the district needs to find additional funds to invest in older facilities, Delcour said. “It’s really about finances and needs,” she said.
“It was assumed that the district would find other capital funding funds to really manage the half of the portfolio that had no significant post-Katrina investment,” she said.
That could mean asking voters to approve another mileage on top of the existing $4.97 million Major Repairs Tax, which funds the program, she said. It expires in 2024.
Additional sources of revenue could also help the district meet emergency repairs. Delcour said the district typically spends about $10 million a year on unforeseen emergency capital needs, but with Hurricane Ida last August, the district spent $12 million this year.
“We know emergencies are happening in this district primarily because we’re in an area that’s prone to disasters, the impacts of climate change, and also just the historic nature of our facilities,” Delcour said.
With limited funds available, the district will prioritize the most imperative projects that essentially keep buildings intact, airtight and “if we don’t work, we can’t have a school,” Delcour said.
The majority of facilities are “high quality,” but about 11 are considered the worst quality and represent 40% of capital requirements, Delcour said.
For schools housed in the most disadvantaged facilities, Delcour said the district would “seek every opportunity” to move them to a higher quality facility. The district may also consider sharing facilities between schools.
But with the projected drop in enrollment as the population shrinks, the number of schools needed in New Orleans could drop. Earlier this year, three schools were selected to move into district-owned buildings, two of which were vacated at the end of the school year by schools that will voluntarily close due to declining enrollment. As the process continues, Delcour said, the district plans to hire a demographer and come up with a plan with community input on how best to use the empty buildings owned by the district here. December of this year or early next year.
Board member Carlos Zervigon questioned the logic behind how funds are allocated to the School Facilities Preservation Fund and said deferred maintenance amounted to the “destruction of facilities of the district”. When he attended Eleanor McMain High School, he said, there was no air conditioning, the heating broke “all the time”, paint was peeling off the ceilings, the roof was leaking and there was asbestos.
“People of my generation are quite sensitive to this issue in terms of neglect,” Zervigon said. “We certainly don’t want to repeat that and it seems ironic that the older buildings that need it the most are linked, so the solutions have created a new issue of potential deferred maintenance if we don’t fix that.”