Agenda and Notes April 11, 2019

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 Agenda

 

April 11, 2019, Board Finance and Audit Committee Meeting
Panorama Village Building, Meeting Room A - 11:45 a.m.
240 Villa Crest Drive
State College, PA  16801

I.     Call to Order


II.     Local Economic Revitalization Tax Assistance (LERTA) (presentation)

  State College Borough and Centre County Government

III.    Premier Power Solutions - Lee McCracken (presentation)

IV.     Budget Development 2019-2020

          Special Education

V.      Future Meeting Agenda Items

- Budget Development 2019-2020

- 403(b) Plan Document

VI.    Public Comment

VII.    Adjournment


4-11-19 Board Finance and Audit Committee Meeting Notes
Meeting Room A - 11:45 a.m.                                                        Accpeted Notes
Panorama Village Administrative Center
240 Villa Crest Drive
State College, PA   16801

Present: Amber Concepcion, Scott Fozard, Jim Leous, Laurel Zydney
Absent: 
Others: Randy Brown, Bob O’Donnell, Nancy Reese, Donna Reinhart, Sharon Shalter, Donna Watson
Guests: Gary Brandeis, Tom Fountaine, Adam McCracken, Lee McCracken, Evan Myer

A copy of all materials distributed to the committee members for discussion are included with the official minutes, unless otherwise indicated.

I.    Call to Order
Mr. Fozard called the Finance & Audit Committee meeting to order at 11:49 a.m. the meeting was turned over to Mr. Brown.

II.   Local Economic Revitalization Tax Assistance (LERTA)
Mr. Brown introduced Tom Fountaine and Evan Myer from the State College Borough, to talk about Local Economic Revitalization Tax Assistance (LERTA) proposal. Also present was Gary Brandeis, a local developer, to answer any questions about his particular project.  Mr. Brown stated the discussion was not just about a project, but a zone that could have multiple projects. Mr. Brown turned the discussion over to Mr. Fountaine and Mr. Myer. Mr. Fountaine reviewed the handout and stated a proposal has come before the Borough of State College, the School District, and Centre County to establish a LERTA district in downtown State College.  The handout covers the overview of LERTA, properties that would be eligible, memo summarizing the program, and State College Borough ordinance. LERTA is a tax abatement program in economic development created by the Commonwealth of PA in 1977 authorizing local taxing authorities to provide tax exemption for ten years on construction improvements. LERTA helps to encourage economic development and revitalization in areas that became aging for multiple reasons, noting that Lancaster used this program successfully, as well as other areas in the Commonwealth.  To utilize the highest impact, it would require all three jurisdictions to be part of the LERTA program. A map and photos of the zone were identified in a 1982 Centre Regional Planning Commission report; commercial (non-residential) use qualify, rehabilitation or adaptive reuse of the current structures that may not be demolished; required application and approval; must have a proposed improvement in excess of $25,000. The proposed zone has 22 properties eligible, two projects are in the process of being demolished; PSU James building and the SCASD old Administration building; a minor proposed change in the zone will be discussed.  LERTA is not a tax free program but an abatement program. Steps in the process: LERTA application, base assessed value determined at the time of application, not eligible if the assessed value was appealed or lowered within the past two years, upon completion a Certificate of Occupancy (COO) is secured. At the time of COO, the property is reassessed for project value and amount of increased value would be subject to abatement. Tax revenue would increase over the ten year period, however, increased millage rates would be applied as they occur. After the first public Borough meeting on LERTA, it was suggested to add three fraternity buildings on the south side of Beaver, current map now shows these structures; this is a proposal and not yet vetted by the governing bodies.  The map shows the highlighted properties that are eligible for LERTA; criteria is only currently for the borough and was determined from the 1982 Centre Regional Planning report. Board member asked if the LERTA zone could be changed, Mr. Fountaine stated yes, if the three governing bodies agreed. The goal is to focus on preserving historical structures and allows for different types of commercial uses. If a property applied with commercial and residential usage, only the commercial portion would be eligible for the abatement. It was stated that this does not stop tax revenue but would increase by percentages over a 10 year period; once the project is complete, it would be assessed and would actually add tax revenue. Questions and discussion followed; the goal of the timing for approval for the LERTA program is early May.  Ms. Concepcion thanked Mr. Fountaine and Mr. Myer for coming and presenting the information.

III.    Premier Power Solutions
Mr. Brown introduced Lee McCracken from Premier Power Solutions, who has been our energy consultant for a number of years, to address the topic of power sources including solar. Mr. McCracken introduced himself, gave a brief history, and pointed out page 6 of his presentation. Premier has been able to help the District save $3 million by lowering the kilowatt hour from 7.5 cents to 5.5 cents. Mr. McCracken then discussed the energy outlook for the next 30 years noting the information presented came from the U.S. Energy Information Administration (EIA). The report shows natural gas prices remain comparatively low, electricity will remain flat, intermittent renewable (wind/solar) will see growth; solar costs will trend down over the next 10-15 years and electricity prices will remain constant through 2050; SCASD electric prices have decreased 28% since 2010.  Page 9 showed graphs on natural gas and renewable energy sources over the next 30 years; solar usage will increase as the price to produce solar comes down. Steps to determine how to proceed were presented: history of prices, evaluate market research, review available options and making a decision; page 14 had options and breakdown of buying power for 3, 7, 15, and 20 to 25 years to lock in costs of brown power (additional cost associated with solar energy cost); discussion and questions followed. Current District energy contract ends fiscal year 2020. Ms. Concepcion mentioned a representative from SCASD Board was asked to join the Energy Study Group. The Finance Committee were in full agreement that a recommendation would be presented at the April 22, 2019 Board meeting asking for a representative from the SCASD Board be named to join the Energy Study Group. Mr. Brown was also asked to participate in the Energy Study Group.

Dr. O’Donnell left the meeting at 12:30 p.m. and returned 12:38 p.m.

IV.    Budget Development 2019-2020
Dr. O’Donnell briefly discussed the budget planning proposal; looking at the overall budget and what is being propose within Act 1 and taking a step forward in a response to those needs and how we prioritize; proposed one Elementary Special Education and two Elementary Education positions which will allow for late summer enrollment issues and shifting of resources if needed; moving forward with online classes, noting there are currently close to 60 online students; utilizing two English teacher positions to focus on designing virtual courses for online students. Dr. O’Donnell then turned the meeting over to Ms. Salter to discuss the two positions that were added to the proposal.  

Special Education - Ms. Salter discussed the proposed addition of two teachers due to the  needs in the High School and Elementary; pulling one position from Middle School RIT to cover part of the need in the High School and hiring one elementary teacher to work in either Radio Park, Corl Street and Ferguson or a combination of the three. Final evaluation on exact location will be determine end of summer when enrollment numbers are finalized.  Dr. O’Donnell discussed the shift in students with higher special needs; Ms. Salter pointed out the disability chart showing zero does not mean zero students but that PDE reporting shows anything under 10 students appears as zero; in some categories we currently have students that are showing zero. Dr. O’Donnell said a reflection study would be happening to look at our system, how we provide services, and our growth mindset. Discussion and questions followed and Ms. Salter was thanked for coming to update the committee.

V.   Future Meeting Agenda Items

  • Budget Development 2019-2020
  • 403(b) Plan Document

VI.   Public Comment
There was no public comment.

VII.   Adjournment
Mr. Fozard adjourned the Board Finance and Audit Committee meeting at 2:09 p.m.

 

Submitted by,


Nancy Reese