Parkland School District Seeks for Loan Reimbursement

BREINIGSVILLE, Pa. — Parkland School District officials applied to the state of Pennsylvania in 2010 to receive partial reimbursement for the $16 million loan necessary to complete construction on the Fred J. Jaindl Elementary School.

The district’s goal was to be approved for eight of the 11 steps in the state’s approval process for construction projects. This approval would have been the last obstacle standing in the district’s way of receiving the loan reimbursement.

According to John Vignone, director of business administration for Parkland School District, school districts have to wait two or three months after submitting the application to begin receiving reimbursement money. Parkland School District, however, has yet to see any after three years of waiting.

Wilson Area School District is facing problems similar to those of Parkland School District. The district applied for reimbursement one month after Parkland, and has yet to see any of the money for its construction projects.

“There was never any talk or any warning that you may submit something and it would not get paid. I think that was a surprise to all of us,” said Vignone.

The problem seems to lie in the backlog of projects waiting for approval with the state’s system of reimbursing school construction — the Planning and Construction Workbook. The workbook currently has 188 projects that have yet to see the eighth step in the approval process, as well as 166 additional projects in a different stage of development.

Jay Himes, executive director of the Pennsylvania Association of School Business Officials, believes the backlog could have been anticipated based on the way the state used the PlanCon budget for charter schools. The state began paying charter school lease reimbursements, which grew from $2.3 million to $8.2 million of the budget for 2012 to 2013. These reimbursements were improper, according to the auditor general’s office.

Additional costs stemmed from the state’s new incentive providing a 10 percent funding bonus to buildings eligible for green certifications. PlanCon’s budget was cut by $20 million in 2011 and increased by only $865,000 for 2012 to 2013, which provided an additional clog in the budgeting issue.

While the State Department of Education works on finding a solution to the Planning and Construction Workbook’s backlog, school districts are forced to make a decision. They must choose between moving forward with construction plans without the state’s involved step-by-step process, or waiting indefinitely until the PlanCon program is restructured. Moving forward can cause problems for districts that haven’t received approval, but waiting will increase interest rates and construction costs.

Bethlehem Area School District, another district affected by the PlanCon backlog, decided to move forward with its construction of the new Nitschmann Middle School and will submit the construction applications to the state once the project is completed, according to Superintendent Joseph Roy. The district is slated to receive $7 million of the $53 million project from the state, but there is no way to predict whether the district will receive the reimbursement for a project not approved by the state.

The state’s Department of Education is currently working on a plan to pay back the money the state owes and avoid similar issues in the future.