Schalmont officials are planning to pay down more debt since they do not need to keep as much money in their reserve fund for property assessment challenges.
In June, the district ratified a deal that settled a decades-long tax dispute between General Electric, the school district, Schenectady County and the town of Rotterdam. The agreement lowered GE’s property assessment by $6.5 million, to $132 million, and the district agreed to repay $721,635 in property taxes collected from GE from 2007 to 2011. The district tapped $331,500 of its surplus to pay off that debt.
This settlement locked in GE’s property value and eliminated a major uncertainty for Schalmont.
The district has also been paying back $6.15 million it borrowed in 2002 to refund GE’s taxes from a previous assessment challenge. When a state Supreme Court ruling earlier that year lowered the plant’s assessment from $275 million to $122 million, the district was on the hook for paying back $11.6 million. GE waived $1.55 million as a gift, the district used some surplus and borrowed $6.15 million.
School business official Joseph Lenz said the district still has some tax challenges, but GE was the major one, so school officials feel comfortable using between $3 million and $3.5 million of its surplus to pay back more of the original GE bond.
“Initially, they were thinking the settlement was going to require a large payment to GE, but since that didn’t happen, we’re going to pay down some of that remaining debt to help with budgeting,” he said.
The fund currently has about $6.5 million, according to the district’s most recent audit from Marvin and Company.
The district total bond debt is $27.7 million. It is paying back bonds to renovate all of its schools, including Woestina and Mariaville, which closed as elementary schools at the end of the 2010-11 school year. Capital Region BOCES is leasing classrooms at Woestina for about $100,000 annually and Mariaville is listed for sale at $600,000. Coldwell Banker Commercial is marketing the 18,000-square-foot building on 6.8 acres of land.
Lenz said there has been some interest in the Mariaville school, including one potential buyer who looked at it a couple of times. “We’re waiting to see if anything comes to light on this,” he said.
There were no major problems found in the audit, according to Lenz. “It was very clean,” he said.
The district’s revenues in 2011-12 were $40.8 million, which was about $2.5 million more than expenses. The district received $310,000 more in revenues than budgeted and spent $3.2 million less than budgeted.
Schalmont also faces the same problem in paying for health care and pensions for retired employees. It only has enough cash on hand to pay the current year’s costs and its total liability is $11 million.