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Fargo School Board to seek AG opinion on tapping loan fund for schools

FARGO - The Fargo School Board voted 9-0 Tuesday to seek an attorney general's opinion on whether two school district projects qualify for a state low-interest loan fund for new school construction.

FARGO – The Fargo School Board voted 9-0 Tuesday to seek an attorney general's opinion on whether two school district projects qualify for a state low-interest loan fund for new school construction.

The district, which is finishing construction on the $15 million Ed Clapp Elementary School and starting construction to create the $9.5 million Eagles Elementary by next fall, wants to tap the loan fund to save on interest costs.

The district has been selling bonds for its projects at 3 percent, while the loan fund offers 1 percent loans for 80 percent of construction projects, board member Jim Johnson said.

According to the Legislative Council, the law calls for a public vote to approve a school construction project before it can qualify for the loan fund.

The school board didn't seek a public vote on either school, and is financing the projects using bonding from its 15-mill building fund and an 11.4-mill special levy fund approved by voters in 1991, Johnson said.

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A 2008 attorney general's opinion said that the voter approval of the special levy fund 17 years earlier still held up for use in building Davies High School, which also didn't get a vote by district patrons.

Johnson said planning committee members believe the special levy fund should still qualify as a public vote for Fargo school projects and that the district should be able to take advantage of state help for the two buildings.

He said the Oakes and Hillsboro school districts are facing similar questions for construction projects they are considering and could be potential partners in seeking the opinion.

"We think it makes sense to get this opinion," Johnson said. "It would be a nice pool of money to play in" for capital projects.

Board member John Strand sounded a note of caution, noting that the Legislature or the courts could act to negate any attorney general's opinion.

But Paul Meyers said taking no action wouldn't help the district either.

"We have nothing to lose by voting on this," Meyers said.

In other business, the board voted to make the name Eagles Elementary School official for the building being created from the former Eagles Center.

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While some board members held that the building had long carried the Eagles name and wasn't a new building, others held that the significant additions to the site made it a new facility.

The result was a 5-4 vote in favor of the Eagles name. Strand, Rebecca Knutson, Jennifer Benson and Paul Meyers voted against using that name without public input.

The board also approved its preliminary budget for the 2015-16 school year.

General fund revenues are expected to be $145.4 million for the year, up nearly $10.2 million from 2014-15. The general fund balance is expected to be nearly $28.45 million.

In addition, the board voted 6-3 to levy 1 mill for special assessments and approve the special assessments budget. The extra mill will be used to help pay down the district's costs of building access roads and entrances for Ed Clapp Elementary, pay down special assessments for the Bluestem facility in Moorhead (which houses the Trollwood Performing Arts School), and other miscellaneous assessments, Johnson said.

Strand, Benson and Paulson voted against the special assessments budget plan.

And the board unanimously elected Linda Boyd president for the 2015-16 school year. Meyers was named vice president.

Related Topics: SCHOOL BOARDEDUCATION
Helmut Schmidt is a reporter for The Forum of Fargo-Moorhead's business news team. Readers can reach him by email at hschmidt@forumcomm.com, or by calling (701) 241-5583.
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