During a recess at the March 12, 2012 DeKalb County Board of Education meeting, Board Chairman Eugene Walker and Superintendent Cheryl Atkinson listen as Board Attorney Bill Wildman, left, and Director of Planning and Forecasting Dan Drake, right, discuss a plan to move sales tax money to avoid cutting school construction projects.

DeKalb County Board of Education members are waiting to see if there’s a chance to save construction projects in their districts that would otherwise be cut to prevent a $36.5 million shortfall in the system’s sales tax fund.

At its meeting on Monday, March 12, the board voted to have its attorney and school staff research whether the board can use money from future sales tax revenues to complete the current construction project list.

For Dunwoody residents, it means Dunwoody High School has a chance to keep $1.1 million to finish up renovations and Peachtree Charter Middle might get $250,000 for a new track.

The board could reconvene as early as Friday if there is no way to complete some or all of a long list of more than 30 construction projects targeted for cuts, a plan that would save $31 million.  The plan would also close out several dozen more projects, saving an additional $5.6 million.

If DeKalb County Schools can’t use future sales tax income, Superintendent Cheryl Atkinson will again ask school board members to make the decision they have postponed since Feb. 29, when the potential shortfall was first brought to their attention. District 1 board member Nancy Jester said she’s “cautiously optimistic” the board will find a way to protect the local projects.

“I’ll wait for the info,” Jester said. “We’ll see.”

The board is using a complicated maneuver involving money from the Special Purpose Local Option Sales Tax, commonly known as SPLOST, which provides a penny sales tax for school construction.

The current projected shortfall is from the third SPLOST, or SPLOST III, voters approved in 2007 to pay for $466 million in projects, a number later amended to $513 million. The school board revised its projections because the tax to-date has generated $490 million and school officials anticipate another $23 million in state funding.

Voters approved SPLOST IV in November. It is expected to generate another $475 million in sales tax starting this year.

Everything clear so far? Here’s where it gets tricky.

District 1 DeKalb County Board of Education member Nancy Jester discusses her concerns about how the DeKalb County Schools has handled its accounts for construction projects while fellow board member Donald McChesney, District 2, listens.

What put the school system in a bind with SPLOST III was the $300 million the school system borrowed in anticipation of the sales tax money. When the school system borrowed the money, it did not account for the interest payments, leaving it short $21 million in borrowing costs. That’s the bulk of the shortfall.

In addition, in May 2009, the board added $47 million worth of projects to SPLOST III because the school system officials saw the revenues were coming in better than expected.

Which brings things back to SPLOST IV.

School officials initially said that no SPLOST IV money could be used for unfinished SPLOST III projects.

But Atkinson says SPLOST IV is going to work differently. The new SPLOST money will be used in a “pay as you go” model, eliminating borrowing costs. School spokesman Walter Woods said the school system will likely borrow some of the money, but it won’t be anything close to the amount it borrowed for SPLOST III.

The board’s action on March 12 was a little confusing to those gathered in the audience, but the bottom line is the board did not vote to cut projects and is looking for a solution so it won’t have to.

Board Attorney Bill Wildman said school officials will have to look at the wording of the SPLOST IV referendum to see if it is general enough to allow the school system wiggle room.

Atkinson said suggested the issue wouldn’t require any further board actions if the SPLOST IV money is available for the SPLOST III projects.

“If we find in checking the language that there are things we can move to SPLOST IV and the dollars will be there, because we won’t have the same amount of interest to pay, then we will resolve it,” Atkinson said.

And, assuming that happens, it’s not clear whether leftover SPLOST III projects would begin before SPLOST IV projects start or after SPLOST IV projects end.

It’s not the only thing that’s unclear regarding the shortfall.

School finance officials first discovered it when they realized rebuilding Chamblee Charter High School will cost $10 million more than anticipated. The rebuild, which hasn’t started, will now cost $78 million. Further investigation revealed a bigger problem, including the problem of not accounting for the borrowing costs.

It has not been explained how school officials let that one slip by them, but it should be noted that Atkinson was hired in 2011 and wasn’t there at the time SPLOST III was approved.

The board is considering the cuts to finish Chamblee.

Jester, who joined the board in January 2011, says the financial miscues on the SPLOST III money bother her.

“I’m very concerned about that and now we’re making these decisions,” she said during the March 12 meeting. “We’re between a rock and a hard place.”

In this video District 1 DeKalb County Board of Education member Nancy Jester discusses her concerns with proposed cuts to a school construction project list during a March 12, 2012 board meeting.

Dan Whisenhunt

Dan Whisenhunt wrote for Reporter Newspapers from 2011 - 2014. He is the founder and editor of Decaturish.com