March 11, 2016 / Golden Mile Alliance / News
By Jeremy Bauer-Wolf, Frederick News Post
Friday, March 11, 2016
Two oft-discussed elementary schools, planned in the Urbana and Hillcrest areas, will be built on schedule and open in August 2018, the county announced Thursday. Advocates have spent recent months fighting vigorously for the schools, which are intended to alleviate student overcrowding.
But the timeline for other schools in the years ahead is still jeopardized.
The county will also delay, until fiscal 2019, renovations to southern Boyers Mill Road, from the “bridge south to Old National Pike,” Gardner said. Three fire stations that were requested, but never included in the county capital plan, also won’t be funded — a Hamptons West fire station, a Jefferson Tech Park fire station and a downtown Frederick station.
County Executive Jan Gardner on Thursday announced the developer partnership. These developers will front the costs of the state share of funding — a total of about $27 million — on three projects: the new Frederick High School, which is under construction, and the two elementary schools, Sugarloaf Elementary School, in Urbana, and Butterfly Ridge Elementary, in Frederick.
That $27 million will be split evenly between the two developers, Natelli Communities and Elm Street Development. The breakdown of the $27 million will be $9.8 million for Frederick High School, $6.8 million for Sugarloaf Elementary and $10.2 million for Butterfly Ridge Elementary.
The developers will put up a letter of credit. The county will borrow the state share of what the schools would cost, and the developers agree to carry the interest on the bond. This is known as “forward-funding.”
Other projects are still endangered in future years, officials said.
Future state money would need to be redirected to pay off the debt — which may take roughly five years, Gardner said — instead of other school construction in the later years.
Beyond the elementary schools, Frederick County Public Schools has sought an addition to Waverley Elementary School, a new or renovated Rock Creek School, and a new elementary school in the eastern part of the county. Gardner also announced Thursday a task force to examine school construction solutions. Still, no one can yet identify where the county will scrounge up more funding.
“I have committed to the developers who have stepped forward that I will help them and be part of the solution to find the out-year strategy, as well,” said M.C. Keegan-Ayer, vice president of the County Council. “Because if we’re not all working together, this boat is going over the waterfall.”
County officials were in months of talks with the developers before arriving at a compromise.
The fee that developers pay when they want to build near an overcrowded school, a mitigation fee, now remains unchanged. Gardner had proposed a sharp increase in the fee late October, to developers’ chagrin. The legislation to alter the mitigation fee is being considered by the Frederick County Council. Council members approved an amendment to that bill to leave the mitigation fee untouched, though it still imposes an automatic annual adjustment of the fee.
The option for developers to use a mitigation fee will end in July. Gardner, who opposes mitigation fees, said she knows the development community has expressed interest in having this extended. Legislation has not yet been proposed on this front.
Gardner’s other proposal, a boost to county impact fees — which are also levied on developers and channeled toward school construction — is still before the County Council, though the increase is spread out over two years instead of one. Gardner said she is including increases to impact fees in her budget, but not mitigation fees.
Natelli Communities, led by its president and chief executive officer, Tom Natelli, is a chief developer in Urbana. Elm Street Development, represented by Vice President Jason Wiley, is the developer of Lake Linganore, as well as Eastchurch, a project on the east side of the city of Frederick.
In interviews, both Natelli and Wiley said that they worked with the county government to develop both a solution to school construction woes and find benefits for builders. Natelli signed on to a county-developer collaboration last fall and recruited Wiley into the conversation.
“There was creative thinking on everybody’s part, including the [county] executive’s staff,” Wiley said. “Our objection was the fee increases that were being proposed that would not be bearable. We had to have some sort of alternative solution. In the business of compromise, everybody kind of gives a little.”
Both local and state officials have fretted over the rising costs of school construction, which they have attributed to market conditions and state mandates. The high costs have been evident in the Frederick High project, officials have said, with the most recent estimate being $112 million.
The school construction situation was critical, Keegan-Ayer said. Urbana Elementary School is at 135 percent of its state-rated capacity, according to September school district data, and Hillcrest Elementary, in Frederick, is at 140 percent of its capacity.
Crunching the numbers also unearthed that the county fell short in funding on the new Frederick High School. Without the developer partnership, Gardner said in an interview, the county would have been able to advance only one elementary school on time. This solution also allows the demolition of the current building and construction of a new Urbana Elementary, Gardner said.
On Thursday, Gardner also named members to an ad hoc panel, the brainchild of two County Council Republicans, Tony Chmelik and Kirby Delauter. This task force is narrow in focus and will examine the possibility of the private sector paying for school construction, then leasing the facilities back to the Board of Education.