School Officials Borrow 4-Million Dollars As the readers will undoubtedly recall, the last Heidcamp Report contained a reprint of the letter that I had received from an unknown individual. The informative letter suggested that I look into the official budget for the renovation project at Mt. Marion Elementary School. With the hope of finding answers to some of the comments and/or questions raised in that letter, I filed a FOIL for any and all information relating to the alterations of the Mt. Marion School. I was finally able to review some pertinent documents and will share here the information I received.
According to the documents (which shall be posted on the watchdog web site), on June 6, 2006, school officials dispatched a press release to the Kingston Freeman announcing an "Invitation To Bid" with respect to the contemplated alterations at the Mt Marion Elementary School. Officials requested sealed bids for: • Contract No.1- General Construction Work • Contract No.2- HVAC Work • Contract No.3- Electrical Work The announcement was to run for seven days beginning July 4th, with bids due by July 18, 2006. All bids were required to be submitted on a lump sum basis—segregated bids would not be accepted. The District subsequently received three individual bids (Ashley Mechanical, Inc., Kingston NY; Stilsing Electric, Inc., Rensselaer NY; and Glormar Construction, Newburgh NY), all of which were rejected by school officials as being too high (no documentation was provided under FOIL as to how that determination had been made, nor were any comparables offered).
Operating Outside the Bidding Procedure Without any further bidding, school officials then proceeded to undertake a portion of the work at the Mt. Marion school by using employees from the Maintenance Department, as well as by hiring the following: Sucato Builders, Poughkeepsie NY; Landmark Flooring Concepts, Inc., Albany NY; Alpine Environmental Service, Albany NY; JC Ryan Ebco/H&G, LLC.. Pleasant Valley NY; Ulster Eclectic Supply Co., Kingston NY; and Jupiter Environmental Service, Troy NY A letter dated July 28, 2006, and signed by Business Administrator Joe Dziadik, was sent to Pat Murphy, Jr., and directed Sucato Builders of Poughkeepsie to proceed with the following alterations to the Mt. Marion Elementary School. • masonry: tooth brick returns at 3 windows; masonry repair for 7 lintils; 3 windowsills; and floor infills; • doors, frames and hardware: doors 129/1 and 116/2 installation only with a fire wall for door 129/1 • ACT ceiling for corridors 131 and 129 • 3 windows in existing openings
According to the documents I've received (unless there are more), records indicate that the District was charged approximately $40,000 for these alterations. It is my understanding that by law anything over $20,000 must go out to bid! According to officials this money came from the "general fund." I've also been advised that the District borrowed 4-million dollars (by Bond Anticipation Note issued in anticipation of the sale of bonds tied to the approved 25-million dollar project). The District will have one year to pay off this 4-million dollar loan, I'm sure with interest. And, each one-percent of interest charged on this 4-million dollar loan will cost the District $40,000 for a year....for example, a Note calling for a straight six percent interest would mean an interest payment of $240,000. Chances are good that the rate is an adjustable one, fluctuating each month according to some specified standard. And, so, chances are just as good that the rate would be higher than six percent.
On May 3, 2005 the Board of Education approved a Bond Resolution delegating authority to the Board President, Vice-president and District Clerk (Rhau's secretary) to sign by manual or facsimile signature any Bonds and Bond Anticipation Notes. Although I agree that Mt. Marion School is in desperate need of repairs, I question why the District had to borrow 4-million dollars for a $40,000 job. Why didn't they re-bid the job? Where is the rest of that $4-million dollars? What account is it in? Are interest charges accruing on money that is just sitting there? Were any other alterations done? Where is the one-million dollars voters approved a few years ago for repairs to the roof at Mt. Marion School? I would hope that this money wasn't just dumped into the General Fund and then used to pay for coast-to-coast trips? But, if it had been dumped into the General Fund, there would have been plenty to cover the $40,000. I approached three board members and asked them about the 4-million dollar loan and was told by each that he had "no idea" the District had borrowed 4-million dollars. Who signed the Note... former Board President Buono? President Brennan? the District Clerk (Rhau's personal secretary)? Why wasn't the board (or the public) informed that the District had borrowed 4-million dollars? If Rhau kept the board and the public in the dark about that, what else is he keeping from us? The public has a right to know these answers.
Now on November 28th, Rhau is asking voters to approve an additional $2,775.000 for renovations—that is in addition to the 25-million already approved (does this mean a tax increase?). The Proposition reads: "Proposition 1- Shall the proposition set forth in the legal notice of this special voter meeting, authorizing the expenditure of additional amounts for the capital improvements previously approved by the voters of the School District on March 15, 2005, consisting of addition to, and reconstruction and equipment of school buildings and facilities, and various site and other incidental improvements, at an estimated maximum aggravate additional cost of $2,775,000, the issuance of debt obligations of the school district therefore, and the levy of a tax in annual installments therefore all as more fully described in said notice, be approved?"
We are expected to take the 1-million dollar "Excel Aid" into consideration, but I've been advised that the Excel grant is an entitlement that we will receive whether this proposition is passed or not. This bears consideration and I will try to verify the same and report the results on the watchdog web site prior to the November 28th vote.*
An Informed Voter is a Good Voter There are approximately 13,000 registered voters in the Saugerties School District. I urge voters to come out on November 28th and vote.
Stay tuned, more to come....... George D. Heidcamp, Sr. November 21, 2006 To review New York State
Board of Education questions and answers with
respect to Excel funds, click
here |