Akron City and Akron Public Schools officials met Oct. 10 under the Joint Board of Review to restart oversight of the Community Learning Centers (CLC) cooperative agreement and to review remaining bond proceeds, reserve funds and access issues.

The session focused on two pools of money: about $18 million in school-held bond proceeds from a 2016 issuance and an $18 million or so city reserve that helps guarantee debt service on the CLC bonds. City finance officials warned that federal arbitrage rules could require returning a portion of the interest earned on the bond proceeds unless the parties act to use the funds for eligible capital projects.

Why it matters: The CLC bonds and their associated income tax pledge remain on the city balance sheet through February 2033, and annual debt service is currently about $20.3 million. Akron Public Schools contributes $3 million of that each year; the city covers the remainder. If the dedicated quarter-percent income tax were insufficient in a downturn, the city could be required to use broader income-tax revenue to meet bond obligations, officials said.

City finance director Steve Fricker said, “So the bond proceeds, there's about $18,000,000 in bond proceeds, that is the remnants of what was last issued in 2016.” Dr. Thompson, responding for the school district, said $18,190,000 “sits in that account right now,” and stressed that the longer the funds remain unused the greater the arbitrage risk.

Officials gave multiple, related figures during the meeting: the city described total outstanding debt-service costs over the remaining bond term as roughly $20.3 million a year; Fricker and the mayor said the outstanding principal had been estimated previously at about $160 million while another city official described the broader debt picture as “just under $200,000,000.” Participants agreed those variations require a written accounting.

Discussion highlights and context

- Arbitrage and timing: City staff said interest earned on proceeds since 2016 could be subject to federal arbitrage rules and that a calculation requires school construction-fund records. Both sides agreed to exchange those records so legal and finance teams can calculate any potential IRS payment before deciding on use of proceeds.

- Two distinct funds: Participants emphasized there are two separate pools — bond proceeds under school custody (about $18 million) and a city-held CLC reserve (roughly $18–18.5 million) pledged to bondholders to protect debt service. City staff said the reserve is not generally available for discretionary spending because it is pledged in the bond indenture.

- Uses and limits: City officials and the finance director reiterated the CLC-related tax and bond proceeds may be used only for capital construction or to pay debt service; they cannot be used for operating expenses. That constraint frames options for applying proceeds to projects such as the previously discussed North, Piper or Miller South projects and whether using proceeds would make those projects CLCs under the agreement.

- Project questions and legal review: Multiple board members raised whether spending bond proceeds on projects such as Piper or Miller South would change those projects’ status under the cooperative agreement and whether the agreement would require amendment. Officials agreed city and district legal counsel should analyze the contract language and provide guidance.

- Access and CLC advisory committee: Board members and city staff pressed for stronger, more equitable community access to CLC facilities. Rochelle Wardell and other staff reported a year of work on operational barriers (fees, procedures, insurance, online reservations) and said next steps include formalizing the CLC advisory committee called for in the agreement and adding citizen representatives who use the sites. Several board members asked that community representatives (neighbors, small-group users) be included when appointments are made.

Decisions, directions and next steps

- Administrations from both entities will meet to exchange the financial records needed to calculate any arbitrage liability and to clarify outstanding principal, interest and final debt-service projections.

- City staff will provide a written summary of the finance briefing given at the meeting; the school district asked for the same materials in writing to share with board members.

- Rochelle Wardell (city) and Angela Carter (district chief of staff) were named as operational point persons to collect questions and coordinate responses; board members asked that both be copied on correspondence so each side has shared access to documents.

- Participants agreed to convene regular follow-up Joint Board of Review meetings; the group discussed meeting every other month as a working cadence and asked administrators to propose specific dates.

Votes at a glance

- Approval of previous meeting minutes: Moved by Mayor Malik; seconded by President Margo Somerville. No formal roll-call vote was taken for this committee meeting; the chair allowed the body to proceed without a recorded vote (motion moved and seconded; no formal vote called).

- Adjournment of the Joint Board of Review: Moved by Vice President Alexander; seconded by Mayor Malik. Outcome: adjourned.

What was not decided

Board members did not adopt any change to the cooperative agreement, did not direct spending of bond proceeds, and did not make a final determination about using proceeds on specific school projects. Legal and finance analyses were requested before any formal recommendation.

Next meeting and public-facing items

Administrations will circulate written finance and contract materials before the next Joint Board of Review meeting so members can review possible courses of action, legal constraints and community-access proposals. The group signaled intent to formalize the CLC advisory committee and to include citizen representatives who use the CLCs.

Ending: The two sides ended the Oct. 10 session by asking staff to meet, produce written analyses, and return to the Joint Board of Review with recommendations and a proposed meeting schedule; no spending or contract amendments were approved at the meeting.