The turmoil in the nation’s credit markets is not likely to thwart the construction of the town’s first new school building in nearly a century.
Montclair Schools Business Administrator Dana Sullivan said the district is going ahead with plans to construct its long-awaited $35 million school on Washington Street. The plans received their final go-ahead earlier this year after several years of delays and controversies.
"The project has been approved," Sullivan explained. "It was bid on and came in at budget. We’ve already broken ground."
Sullivan said the construction is expected to take two years to complete, with students slated to move into the new complex in time for the 2010 academic year. The project will be financed in stages through the sale of municipal bonds sold by the township government.
Municipal bonds, which are traditionally a relatively safe and conservative investment vehicle, have yet to feel a major impact from the chaos in the nation’s credit markets.
First Ward Councilman Rich Murnick, who also sits on the five-member Board of School Estimate which approves the Board of Education’s annual operating budgets and capital projects like new schools, said Montclair recently entered the bond market and sold bonds at an interest rate between 3.5 and 4 percent.
"Montclair is fortunate in that it enjoys a solid rating," Murnick said. "We are going to be careful and do what we can to make sure that the township will be able to maintain that rating in the months ahead."
Local officials said the chaos in the nation’s credit markets is more likely to be felt locally by homebuyers, car buyers, and small businesses. With banks reluctant to make loans, money for new cars and homes, even for buyers with good credit histories, is going to be hard to find, officials said.
Construction for the new school is expected to begin within the next few weeks.
Meanwhile, school officials are keeping an eye on the district’s $110 million operating budget, which was approved last winter. Sullivan said the district has not been hit with any unanticipated increases as a result of the credit problems.
