PORTLAND — City councilors are looking to establish a capital improvement reserve fund for future school projects.
The council held a first reading on the reserve, which is a little more than $2 million, at its April 4 meeting. A vote is expected April 25.
City Finance Director Brendan O’Connell said the reserve will include surplus funds from the fiscal year 2015 school budget.
O’Connell said the funds put into the reserve, which was approved by the city’s finance committee, would be used strictly on school capital improvement projects outside of the Capital Improvement Plan. This would mean the city would not have to borrow additional money for future CIP projects.
“Anything that would be spent using this would still need to go back before City Council,” O’Connell said.
O’Connell said establishing the capital reserve is “part of our plan to responsibly spend that surplus on school-related capital projects over the next few fiscal years.”
“Each year the city and the schools prioritize capital improvement projects,” he said. “We know that there’s a finite amount of funds we can spend, and we always try to minimize borrowing.”
O’Connell said there are no guidelines about how or when the funds would be tapped, just that the funds will be dedicated to future school improvements. It’s just a source of additional funds, he said.
He said this year, the city selected “100 percent” of the School Board’s recommended priority list for the 2017 CIP, as well as additional work at the Howard C. Reiche Community School at 166 Brackett St.
The School Board’s list included about $2.2 million of roughly $12.9 million being bonded during 2017 by the city. Tapping the reserve for projects means the city won’t have to borrow additional funds for future school projects which, in turn, will not increase the tax rate.
“But some years there may be projects we want to do above the minimum borrowing we want to do, (so we) can use this fund balance,” O’Connell said.