Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Budget And Energy topic
No spam. Unsubscribe anytime.
School board approves $13.35 million energy project, sparking debate over debt and taxes
Summary
After a presentation on the 2025-26 preliminary budget, the Southmoreland School District board voted 7-2 to approve a guaranteed energy savings contract with Constellation that would borrow $13.35 million; board members and the public debated projected savings, debt-service impacts and millage effects.
The Southmoreland School District Board of Directors voted 7-2 to approve a guaranteed energy savings agreement (GISA) with Constellation that would borrow $13,350,000 to fund energy and facility work, the district’s business manager said at the Jan. 21 meeting.
The vote came after a detailed budget presentation from Business Manager Pam Mondock and more than an hour of discussion about the project’s savings, how the borrowing would affect annual debt service and whether the district should wait because energy prices could fall.
Why it matters: The project mixes capital work and an energy-savings guarantee. Mondock told the board that if the district implements Constellation’s full recommendations, the district would need to borrow $13,350,000 and that Constellation projects annual savings of $374,155. Mondock characterized the net projected increase to annual debt service as $244,845 and said that would translate to roughly 1.5 mills — “a dollar 61 per month” for the median household, according to her slide notes.
Board members who opposed the contract warned the additional debt would increase the district’s long-term obligations. “So if we borrow $13,350,000 tonight, that’s $28,500,000 right now that we will go into debt,” said Dr. Catherine Fike. “We put our people in debt for generations to come.”
Supporters said the guaranteed savings and the ability to update aging facilities and systems weighed in favor of the project. Mondock said the district’s starting debt service payment for next year is $2,190,109 and that the Constellation financing would project a total debt-service payment of $2,809,109 before accounting for guaranteed savings. She presented the net debt-service figure after projected savings as $2,434,954.
The board motion authorized the district to move forward with the scope of work and directed that the final contract be subject to solicitor review. The roll-call vote was 7 in favor and 2 opposed.
Other budget context: Mondock delivered an overview of the budget process and assumptions. She said the district’s unassigned fund balance stood at $3,956,000 (up from $3,137,421), that she budgeted health-care costs with a 10% increase for 2025-26 after a 12% increase the prior year, and that she entered a placeholder $500,468 for salary increases (covering Act 93, SEIU paraprofessionals and other support staff) while negotiations continue. She said the district had budgeted $35,552,250 in expenditures for 2024-25 and, if adjusted for a stated CPI proxy in her slide, the comparable amount would be about $39,703,206.
What’s next: With board approval the district solicitor will finalize the contract language. Mondock said the board will continue budget refinements at subsequent meetings, with a preliminary budget in May and final adoption required by June 30.
Quotes: “If we do everything that was proposed by Constellation, the amount we would need to borrow is $13,350,000,” Mondock said during her presentation. Dr. Fike said during debate, “We’re gonna be $28,500,000 in debt for generations to come.”
Ending: The contract vote was the most contentious item on an agenda that also included course approvals, graduation-policy changes, CWCTC program expansion and several facilities motions. The board will meet again for deeper budget work in February.
