Laconia would largely spend $1.8M no-interest loan fixing up LHS

LACONIA — School district officials announced Tuesday night that Laconia is the only district in New Hampshire to express any interest in an additional interest-free federal loan for $1.8 million earmarked for school renovations.

The loan fund is administered by the N.H. Department of Education.

The proposed QZAB or Qualified Zone Academy Bond is limited to inside upgrades for existing school buildings and doesn't allow for new construction.

Six and one-half million dollars of QZAB money was used to pay for part of the just-completed Huot Regional Technical Education Center project at Laconia High School.

Facilities Committee member Malcolm Murray provided the full School Board with a prioritized list of renovations and upgrades that could be done within the High School — the building school officials determined to be most in need of renovations.

Facilities member Mike Persson explained that all of the other school buildings in the city have had significant upgrades in recent years, with the exception of the high school.

The Tier 1 priority, said Persson and Murray, are health and safety issues and installing a sprinkler system and air handlers in the high school are at the top of the list.

Other health and safety concerns include removing the asbestos from disturbed areas in the former science area on the upper floor and installing a radon removal system on the ground floor.

Tier 2 priorities were identified teaching and learning spaces. The Facilities Committee said upgrading the suspended ceilings in most of the class rooms and repairing the aluminum panels on the exterior windows were the top priorities in this category.

Tier 3 priorities were overall facilities improvements and the restoration of the concrete pillars on the front of the high school, suspended ceilings in the corridors,
and removing the carpeting from the hallways and installing hard flooring.

Yesterday, Business Administrator Ed Emond said if the district were to borrow the QZAB money, some of the projects from each category would likely mesh together. As an example he said adding sprinklers to the school would disrupt the ceiling tiles so it would make sense to do both as part of the same project.

In order to qualify for a QZAB interest-free loan, school districts have to meet three criteria: a 10 percent match of local funds, a so-called "Zone Academy" must be created, and a working collaborative with community partners must be established. The district must also have more than 35-percent of the students qualify for free or reduced-price lunches and Laconia easily exceeds that threshold.

Under a 1997 federal law, a Zone Academy must create programs to enhance the curriculum, increase graduation rates, improve employment opportunities and better prepare students for the workplace or higher education. Laconia started a Wellness Academy to qualify for the Huot Center-related loan so that obstacle has already been cleared.

Emond said the Laconia raised $1.050 million in cash and in-kind donations from the community for the Huot Center project, $180,000 of which can be used as a 10 percent match to attract the new funds.

The next step is to bring the loan proposal to the City Council for approval. The council will have to approve the additional interest payments of $78,260 per year for the next 23 years beginning in 2015 — a payment that may or may not fit into the self-imposed loan service cap — $3.2 million per year —  set by the city, which may have other priorities for bond and interest payments in the future.

Of the $3.6 million dollars set aside for principal and interest payments in the 2013-2014 budget, the School District is responsible for $2.480 million. The 2013-2014 payment on the Laconia Middle School is $1.488-million and the payment of the two portions of the QZAB loans for the Huot Center project total $240,000. The interest on a Huot Technical Center supplement is an additional $17,500.

Should the City Council choose not to allow the School District to add $78,240 to the  principal and interest line, the School District could examine its internal budget and look for savings from its operating budget.

Superintendent Terri Forsten said representatives from the School District are scheduled to meet with the Finance Committee of the City Council at 6:30 p.m. on October 15.

Should the City Council approve the additional loan payments, Emond said there would be a least two public hearings. If approved, he said the projects would go to an engineering company, out to bid, and likely take place next summer.