Downingtown Area SD officials warn capital fund near depletion as board reviews $10.5 million in projects

Downingtown Area School District officials told the Board of Directors on Feb. 12 that the district’s capital fund is shrinking and that planned projects for next year total roughly $10.5 million, even as the district projects only about $2.3 million will remain in the fund by the end of the next fiscal year.

The presentation, led by district staff and introduced by Superintendent Bob O’Donnell, reviewed a five-year capital outlook that calls for a target transfer of about $10 million per year from the general fund into capital — though staff said an ideal level would be $15 million annually.

The capital presentation matters because the district is managing multiple large construction projects and recurrent facility needs while local revenue sources have weakened. “We’re trying to hit that $10,000,000 target,” a district presenter summarized during the meeting. Staff projected that, after recent projects and expected expenditures, the capital fund balance would be about $2,300,000 by the end of the upcoming school year.

District staff walked the board through where the money was going and why the fund has contracted. The district reported an audited capital fund balance of $122,400,000 at June 30, 2022 and said the fund has been drawn down by major projects, including prior east/west high school construction and current projects at Beavercreek and West Bradford. Recent revenue sources that bolstered the fund included transfers from a now-closed debt service fund (described in the presentation as $43,700,000) and $2,000,000 the district retained after terminating its Siemens/Autobahn contract. Staff also cited interest earnings and grants as intermittent sources of capital revenue.

Officials said the district historically budgets about $10 million a year for capital but had aimed for $12 million in recent years and would prefer $15 million annually to meet ongoing needs. The district’s five-year projection shows a relatively steady $10 million target, with a modest blip in the mid-range years to cover network infrastructure, building cameras and a planned English language arts curriculum purchase.

Staff detailed next-year projects that account for the $10.5 million figure. Highlights included:

- Window replacements at Bradford Heights, Brandywine Wallace and East Ward: total project cost about $2.8 million, with roughly $1.8 million coming from a state grant and the district’s share about $930,000.

- Public water and sewer work at Brandywine Wallace to replace an on-site well and septic system to support potential future expansion.

- Building automation systems (BAS) upgrades to modernize aging HVAC controls (staff estimated $100,000 for BAS work next year).

- Furniture replacement budgeted at $100,000 for the coming year (staff noted the district typically budgets about $500,000 annually on a 20–25 year replacement cycle).

- Facilities “summertime” projects (roofs, parking lots, sidewalks) and recurring maintenance.

Technology and curriculum capital items were also included in next year’s plan. District staff said devices will be provided in traditional grades K, 3, 5 and 9; third‑grade devices are being funded with grant dollars so there is no district cost for that cohort next year. Device and infrastructure figures presented included roughly $2.9 million for classroom devices and $2.5 million for network and NOC (network operations center) battery/UPS replacements (staff said some network and wireless costs are E‑rate eligible and about 40% reimbursable).

Curriculum capital requests covered multiple subject areas. Staff identified purchases to support new or piloted high‑school math programs and potential ELA and science adoptions in future years. Equipment purchases for science, TechEd, art, FCS and music were listed with varying amounts, such as $154,000 for high school science equipment and $180,000 annually for secondary fitness equipment.

Board members asked for more detail and expressed concern about both the district’s long list of deferred needs and weakening local revenue. Director Strowbridge said she was “sounding the alarm,” urging the district not to underfund facilities after recent catch-up work, and asked that the capital planning keep the board’s strategic priorities in mind. Other board members noted that real estate transfer taxes and earned income collections have been below estimates, and staff said commercial assessment appeals produced roughly $1 million of recurring revenue loss in the most recent reporting year. Staff also cited state budget delays as a risk: when the state has not adopted a budget by June 30 reimbursement streams can be frozen, forcing districts to rely more heavily on reserves.

Several directors asked for a detailed spreadsheet of the five‑year capital plan to review at their own pace; staff said that level of detail exists and that they would share it. Staff also proposed buying certain items now to take advantage of current cost savings and reduce pressure on future years’ capital budgets, including the potential purchase of a house adjacent to the STEM academy (presented as about $600,000 plus renovation) to support life‑skills programming.

No formal board action was taken on the capital plan at the Feb. 12 meeting; staff characterized the presentation as a primer and said a formal budget proposal will be presented at the board’s next meeting in March. District leaders said they will bring a detailed budget proposal next month that ties projected revenues and expenditures together and that the board will have further opportunities to prioritize projects and discuss tradeoffs.

Ending: The board will review staff’s recommended budget and the detailed five‑year capital spreadsheet at the March meeting, where formal transfers and project approvals will be considered. In the meantime, staff will continue monitoring state budget timing, local revenue trends and the outcome of outstanding contracts (including cash flows tied to the Siemens matter) and will provide the board the requested detailed schedule and cost breakdowns.