Houston Middle School funding uncertain

PALMER — The Mat-Su Borough School Board heard from two different Mayors in the Mat-Su Borough prior to their discussion about the Houston Middle School reconstruction project at their meeting on March 3.

Houston Mayor Virgie Thompson who also works at Houston Jr. Sr. High School testified during public comment. The Houston Middle School building was condemned after the magnitude 7.1 November 2018 earthquake destroyed many concrete masonry units within the walls of the building and damaged joists connecting the walls and roof. Since the spring semester of 2019, the 338 middle school students have been housed in 14 portable classrooms as well as the Houston High School building as the two school communities have been forced to share one school campus.

“In light of the $15 million relief grant, I find it difficult to believe the school district would not have the ability to put forward a resolution to the board to allocate $10 million for the school for the balance,” said Mayor Thompson.

MSBSD Superintendent Dr. Randy Trani detailed during his superintendent’s report the existing funding that the Mat-Su Borough has received for the HMS project and the impending deadline to put the bid for the estimated $34 million project at the end of March. If the HMS construction is not put out for bid by the end of this month, the projected opening of HMS in the fall of 2022 could be pushed back between six months and one year. Just hours prior to the meeting of the school board, Trani received a letter from Borough Mayor Vern Halter asking for an additional contribution to make up for the unfunded approximately $10 million needed to put the project out for bid.

“The expected construction cost estimate is approximately $34 million, leaving $10 million unfunded. This letter is my formal request for the school district to cover the remaining construction funding of $10 million. The borough is budgeting to cover the remaining $8.5 million balance of school debt reimbursement due, which is not included in the Governor’s proposed budget for this fiscal year,” wrote Halter. “Given the 15.8 mil in elementary and secondary school emergency relief fund plus the school district’s fund balance, I’m asking the school district to share responsibility of meeting this need. This is the quickest route to returning the staff and students of Houston to a safe and healthy school environment. I would appreciate a response by the end of March so the borough can continue to keep this project on schedule.”

Trani noted his surprise at the letter from Halter and detailed the funding that was available for the project. Of the nearly $28 million in funding available, $5.9 million of that came from the school district itself. Another $15 million in funding from the primary insurance policy has been received as well as $2.3 million from the borough’s interest income reserve fund. There is a secondary insurance policy of $4.8 million that is expected to be made available. While both Halter and Thompson made reference to relief grant funds, Trani said that those specific funds were not available for school construction.

“We’re talking about a delta of $6 million ish dollars and like we heard Mayor Thompson ask us tonight that this should be our responsibility and that we should put the funds forward to make this happen because everyone agrees we need to get the kids the facilities that they need as quickly as possible. It’s already been too long,” said Trani. “We are using those funds for instruction and that’s what they were intended to be used for. If we were to displace either $6 million or $10 million out of that, what we’re really doing is we’re going to impact jobs eventually.”

The borough had expected to hear from the Federal Emergency Management Agency on their determination of the “50 percent rule” which would provide funding for construction of an entirely new building if the damage to the building was greater than half the cost. FEMA has not yet responded, much to the chagrin of the borough and school district, particularly School Board president Ole Larson. Trani did also detail a number of alternative funding options that could become available. Senate Bill 74 which was read before the Senate Transportation Committee last week in Juneau includes $9 million in funding for HMS construction. Trani also presented a different revenue scenario for School Bond Debt Reimbursement than Halter had.

“The borough is assuming this, the Governor has proposed a 50 percent bond debt reimbursement. What we’re hearing is a high probability that the legislators are actually going to pass 100 percent bond debt reimbursement. Now who’s to know what will happen, will the Governor veto that or not, but I just want to be clear that there are these two other things at the state level that are out there that could cover this debt in its entirety,” said Trani. “The buildings are not ours and by statute and state law and code it’s the borough’s duty to take care of the major construction needs of the building, but I can understand certainly why you would want to do that because we all have this pressing need to get the kids back the facilities they need.”

Larson was particularly agitated at the request for additional funding from the school district by Halter. Larson asked about if FEMA would ever respond and noted that typically FEMA takes up to four years before concluding their investigation and providing available funding. Larson asked Trani to draft a letter to Valley legislators that would put SB 74 at the top of the legislative priority list. School Board Member Jim Hart added that the letter should include a deadline by the end of March.

“I know we have a good relationship with the borough, at least when we sit together at the table we talk about having a good relationship, but having a letter dropped on us asking for $ 10 million is not a good relationship,” said Larson. “Considering that we’ve already unprecedentedly put out $5.9 million and we were told that’s all we would have to do, that’s all the money we would have to put out, and now we’re being asked for another nine or 10 million, we don’t build buildings. We don’t build buildings. We have a school board that runs the operation of the buildings. We teach kids.”