By Adam Swift
The price tag for a new Revere High School, how to pay for it, and whether the council should rethink the location of the new school all came up for debate at Monday night’s City Council meeting.
Richard Viscay, the city’s chief financial officer, gave a 30 minute presentation on Revere’s long-range financial planning and how it relates to how the city could pay for the debt service for the new school. Council President Patrick Keefe referred the issue to the council’s ways and means subcommittee, but not before there was a lengthy discussion about the high school cost at Monday night’s regular meeting.
Late last year, the council was asked to submit a schematic design plans for approval to the Massachusetts School Building Authority.
While the council was not asked to finalize a cost or bonding for the project, the price tag associated with the project came in at $499 million, causing sticker shock for a number of councillors and residents. The latest estimates have an MSBA grant covering about $160 million of that estimated cost.
Viscay’s presentation touched on a wide range of avenues to cover the expected debt service for the new high school, ranging from expected new growth from the HYM Suffolk Downs development, to increased city fees, to tightening the city’s operating and capital budgets, to the eventual extra capital that will be available when the city’s pension plan is fully funded in 2034. Viscay also noted that the city does not have any income from cannabis sales, and the council may want to rethink allowing recreational cannabis sales in the city as an avenue to raise money.
Viscay said the peak debt payment of about $19 million would happen around 2029. Once the full new growth kicks in from Suffolk Downs, and the pension plan is fully funded, Viscay said the city should be able to easily take care of the debt payments from 2034 on.
Viscay and Mayor Brian Arrigo said the challenge for now is bridging about a four to five year gap from the peak payment to that date to cover the debt service for the new school.
“Our debt payments are going to start rapidly increasing with the maximum debt payment probably coming around 2028, so that’s a challenge,” said Viscay.
Viscay did bring up the option of a debt exclusion vote, although he said it is unlikely to happen. With a debt exclusion, voters would be asked to approve an increase in their property taxes to pay for the high school project.
As an example, Viscay said raising an additional $10 million per year would mean an increase of about $470 on the average property tax bill.
“I don’t think many people want that, but I have to talk about it,” Viscay said.
Viscay said one of the things the city will have to do in the coming month is look at why the high school cost estimate is so high.
Currently, the owner’s project manager for the high school project is looking for the city to approve the schematic design plans by March 1, meaning the city and council have a number of questions and issues to work through by that potential date.
“I think we have to find out why our school is so expensive,” said Viscay. “I’m curious to know what we can do to reduce cost so it becomes more affordable. I also think a very important part of this is the ability to use a portion of the Wonderland to generate some private development which will generate some tax dollars.”
Viscay noted that the possibility of building a municipal garage on the Wonderland site to provide parking for the high school and to generate revenue has been raised.
“All ideas need to be teased out to tackle this very expensive project that we all say we want to build, but we’ve got to make some tough decisions,” said Viscay.
Ward 6 Councillor Richard Serino said he hopes the city can look toward cost savings through the budget rather than raising fees to help pay for the new high school.
“What I hear every day is that the average taxpayer is burdened as it is,” said Serino, adding that the city has to look at ways to maximize revenue from large developers in the city such as Amazon, HYM, and Redgate,” said Serino.
Councillor-at-Large Anthony Zambuto thanked Viscay for making the presentation, but made it clear that he wasn’t happy with a lot of what he heard.
“Most everything on here is goddamn offensive, excuse my language, and I don’t see a lot of support for it,” said Zambuto. “If you think a million dollars (from) marijuana is going to pay for a $500 million high school, I think you’re dreaming.”
Zambuto said his fear is that the country ends up in a recession and the city lacks the money to make its debt payments for the new high school.
Councillor-at-Large Gerry Visconti said his major concern is the price tag of the project, and that the council based its decision to go ahead with the Wonderland site, in part, because of a lower cost estimate.
“I’ll be honest with you, the cost of this high school when we first went into discussions about design and everything, we were given a $338 million price tag,” said Visconti.
Decisions were made based on that $338 million estimate, said Visconti.
“To be off that much, when decisions like purchasing the Wonderland site were based on it, is not fair to the council,” said Visconti.
Last year, the council agreed to bond $29.5 million to take the Wonderland site by eminent domain. Visconti noted that the price tag on the land could easily increase.
“Maybe that is no longer a valid purchase because we are so off,” Visconti said.
Councillor-at-Large Dan Rizzo said he was also concerned about the looming deadline to submit to the MSBA and the price tag.
Arrigo said the city is looking for a financial plan that helps pay for the project, with the full debt payment not being due until 2029.
“We are throwing around a lot of numbers, and they are all over the place, and that’s just a function of the fact we are in an interesting economic time, and this is a project that is a long-term project,” said Arrigo. “Obviously, there is sticker shock when we talk about hundreds of millions of dollars.”
The mayor said the vote on March 1 is around the design of the project.
“There are implications that correlate between design and the amount of money it is going to cost, but we’re going to be talking about different numbers for a pretty significant amount of time,” said Arrigo. “As we go through this and as we work and come up with solutions, the end goal is to build that school that we all agree we want to build, and that will take us all working together to make that happen.”
Zambuto replied that he did not think there was any intent to deceive the council on the cost of the project, but said the council did not have the proper information to make a decision on the Wonderland site selection.
“The figure changed $120 million after the fact, and that in my mind is reason to pull it back and look at another option,” said Zambuto. “I want to build a high school that we can pay for.”
Arrigo said that reversing course at this point will only increase the cost.
“I want to make sure that it is clear that we have picked a site, everyone has picked a site and we’ve gotten this far with the design,” said Arrigo. “Technically, there is going to be another vote after this one for a bond authorization, so we are not even talking necessarily about money. The design is tied to the money, I get it, but at the end of the day, there is going to be another call and another conversation, and another vote to take on the actual bond authorization.”
Arrigo said going back to the original high school site would not be a cheaper option.
Keefe said the city and the council ultimately have to look at reducing the cost of the high school project.
“No one is happy about that figure,” he said.
The city will also have to look internally to see how it can afford to pay for the project, Keefe said. Results of traffic study