Beatrice staff outline $2.5M–$2.8M interfund loan to finish school construction

District staff briefed the Beatrice Public Schools board on construction financing and an anticipated interfund borrowing to cover a remaining gap between project costs and outside financing.

Unidentified Speaker 4 said the project’s gross maximum price is roughly $40,500,000 and the joint public agency secured a $35,000,000 loan from Pinnacle Bank. "We know those two numbers didn't match up and Beatrice Public Schools was gonna be responsible for what that gap is in between there," the presenter said.

Staff estimated the district will need to shift between $2,500,000 and $2,800,000 from the general fund to the building fund as an interfund loan to finish construction and pay outstanding pay applications. The presenter described the transaction as "an accounting shift" and told the board interfund borrowing is allowed under Nebraska Department of Education Rule 2, but it "will require a resolution" and a board vote at the June meeting.

Board members asked about repayment expectations. The presenter said there is no fixed repayment schedule required, but districts must demonstrate due diligence over a two-year period; schools vary in how quickly they repay such loans. Staff also noted a 14¢ levy in the building fund that, as modeled, would cover a portion of bank loan repayments and could support about $1,600,000 of payback in scheduled installments.

The board did not vote on the loan at this meeting; presenters said a resolution and formal motion will appear at the June board meeting for action.

Next steps: staff will prepare a resolution for the June meeting with updated pay-application numbers and a recommended interfund borrowing amount.