Candidates for Crosslake mayor and city council seats met Wednesday, Oct. 17, to learn about Crosslake Community School’s potential expansion and partnership with the city. The public was also invited.
Though it is still in early planning stages, Crosslake Community School (CCS) is looking to expand and may partner with the city to expand on the Crosslake Community Center property.
Both Crosslake mayoral candidates were at the coffee talk, as were council candidates Darrell Shannon and Mark Wessels and current council member Steve Roe.
Tami Martin, executive director and superintendent at CCS, said the school is looking at several sites, not just the community center site.
CCS, because it is a charter school with no defined district, cannot bond money from the public for new facilities. Partnering with the city, which can bond, could allow the school to expand.
The school is outgrowing its current facilities, Martin said, and she believes it’s in the school’s best interest to expand.
“Charters (like CCS) are most fiscally stable and able to offer the most to their students at the 200-student mark,” Martin said.
Currently, the school has 138 students.
Partnering with the city could allow the school to grow, and, Martin believes, benefit the city through new facilities for public use and more students and families being drawn into town.
Parents and families of CCS students shop and dine in the area, Martin said.
It’s possible that the school could partner with the city without financial impact to taxpayers.
CCS gets a certain amount of lease aid from the state each year for each student. Currently, that’s $1,200 per pupil. The school can either use that lease aid to pay for a building or agree to a lease amount with the building owner, which must be approved by the state.
For hypothetical purposes, Martin examined several funding options for school expansion. She looked at different types of loans, with different rates, to calculate what the city stood to gain or lose.
The project faces a few options for bonds — a general obligation bond, an Economic Development Authority (EDA) lease revenue bond, or a conduit bond.
General obligation bonds would have lower interest rates, but require a city-wide vote, and it’s too late for the option to be put on this year’s ballot. The EDA lease revenue bond and conduit bond options would have higher interest rates and would require a city council vote.
Martin projected that general operating bonds have a rate of 3 percent, and projected EDA bonds and conduit bonds a rate of 5-6 percent.
Martin projected that a $2 million school, at a 5 percent rate for 20 years, would require a student enrollment of 132 students, a number it already exceeds.
At projected enrollments, using the $1,200 per-student lease aid figure, the city would profit $1,459,402.92 over the 20-year life of the bond. After the bond is paid off, all lease aid money would become revenue to the city.
Martin projects her student growth as part of a requirement of the state. The state needs projected enrollments in order to budget. She projects that the school will have 173 students by the 2015-16 school year. With a larger student body comes higher revenue for lease aid.
The worst-case scenario represented was for a $3 million school on a 20-year bond with a 6 percent rate. If the school could not pay all the funding for the building, the burden would fall on the taxpayers.
Under Martin’s calculations, Crosslake taxpayers would have a bill of $10.27 each for 20 years, then the building would be paid off.
Martin pointed out that services such as electricity, gas, garbage, custodial service and building maintenance are not included in lease aid. The school budgets and is responsible for those expenses separately.
If the partnership occurs, it’s expected that the city council and parks, recreation and library commission members would decide where the school would sit.
No decision has been made as to whether the school will partner with the city.
CCS would need support from the city by the end of December to have the option to have the school located on the community center site, Martin said.