Colchester board weighs moving $115M bond earlier as FY26 budget projects about 3% tax increase under current assumptions

The Colchester School Board on Jan. 7 heard a detailed budget presentation and discussed moving the district's $115,000,000 facilities bond work up to begin in the fall of 2025, a change administrators said would accelerate interest and cashflow and could reduce long‑term price escalation.

The discussion matters because the timing of bond drawdowns affects both near‑term operating budgets and the estimated education tax rate. Amy (central office staff) and George (central office staff) presented two FY26 budget scenarios: a baseline that maintains current programs (scenario A) and a recommended scenario (scenario B) that reduces 14 currently open positions. Under the assumptions shown on Jan. 7, scenario B produces an estimated tax increase of about 3.10% for Colchester taxpayers; the baseline scenario showed a higher estimate (4.37%).

Administrators emphasized uncertainty in state variables that drive the final local tax result. "This number has changed several times, since December 1, and we're hoping that that number will be finalized this week," Amy said, referring to long‑term weighted ADM and other state inputs. She and George repeatedly cautioned that the dollar yield set by the state (the final variable in the education funding formula) can move the local estimated tax rate substantially: small percentage changes in the yield could push the estimate from roughly 3% to as high as the high single digits or more, depending on the magnitude of the yield change.

George described the financial mechanics and the effect of accelerating the bond schedule. "If we borrow $30,000,000 in March, we'll need to pay roughly $280,000 in interest in fiscal 25; in fiscal 26 it goes up to about $1,000,000," he said, and he explained that meanwhile the district would earn interest on unspent bond proceeds at current market rates. He added that interest earned on bond proceeds may only be used for projects consistent with the ballot language and cannot be applied simply to pay bond interest on debt.

Board members pressed for more modeling. Several members asked for multi‑year projections that show the tax effect across the bond draw schedule and for sensitivity tables that show how much the district would need to cut to hold the local tax increase at a target (for example, 3%) if the state yield declined by specified percentages. Central office staff said they will return that modeling and noted they are tracking other interacting variables (CLA, long‑term ADM and a pending reappraisal) that can change outcomes.

On project timing, administrators said Black River Design asked whether the work could begin sooner and indicated there would be advantages to starting in August 2025. The board discussed whether that would conflict with prior community communications; attendees agreed the ballot did not include a calendar month schedule and that moving the start up by several months could be justified on financial and scheduling grounds. Several board members said they were comfortable with moving the timeline in line with the design team's recommendation but that the board should continue public communication explaining the change.

The board also discussed programmatic choices embedded in scenario B. Administrators said the proposed reduction of 14 open positions was derived by reviewing current, unfilled vacancies across buildings and spreading changes to avoid a concentrated program hit; they emphasized preserving core special education supports and existing building models. Staff noted other efforts (for example, CHAMP program expansions and targeted operational changes) intended to offset the service impacts of not immediately filling some positions.

Board direction and next steps: trustees agreed to target warning a budget on Jan. 21 unless the state signals a change in the dollar yield before then; they said they will skip a Jan. 14 meeting unless yield news arrives by Friday that warrants an extra meeting. Administrators will provide the requested multi‑year cashflow and tax‑sensitivity modeling, updated bond draw schedules (30M initial draw assumptions and later draws), and an updated public communication plan that explains the bond timing and how the estimated tax rate is calculated.

The board closed the item and moved to remaining business; no formal action on the bond timing or final budget warning occurred on Jan. 7.