The Chilliwack board of education has taken a $9.5-million risk by purchasing a 6.8-acre lot for a new school in Promontory.
They unanimously approved the three motions needed to finalize the deal on Nov. 20, for the plan that was made public just a week earlier. The deadline for the conditions to be removed was Nov. 21.
Throughout the 20-minute Zoom meeting, board members emphasized the risks that came with the deal while agreeing that the bigger risk was losing the land.
Trustee Willow Reichelt noted that staff has been looking for a parcel of land in Promontory that was big enough for a school site, for as long as she’s been on the board.
“I didn’t think we were ever going to find one,” she said. “It would be negligent to let it slip through our fingers.”
Here are the risks, though, as explained by the board.
The first issue is that there is no ministry-approved plan for a new school yet. While they’ve received positive feedback and assurances from the ministry of education, it’s not guaranteed that a new elementary school would be approved.
They are borrowing up to $6.5 million of the purchase from the Bank of Nova Scotia.
If the plan to build a school falls through, the board will have to carry that cost.
“We could be on the hook for this money,” Reichelt said.
But that’s not likely. Promontory Elementary has been over capacity since the day it opened, and there are currently more than 800 elementary-aged children on the hill — with no signs of new-home construction stopping.
School board budgets follow a set pattern each year, and while this potential school is not on the current capital plan, it will be added to the next one. If the school is approved, the ministry would be paying whatever was borrowed from the bank, and the building plan could begin.
Trustee Laurie Throness noted that he’s “usually against debt,” especially when it involves public money.
But he believes the best-case scenario is the most likely outcome here, and the ministry “will do as it usually does and fund the school and land, and families will benefit in the long term.”
He said even if they don’t, and they can’t build the school, the land is “likely to appreciate.”
The land, at 5303 Promontory Road, is tucked against the edge of the wilderness, and likely one of the last large parcels of buildable land.
Trustee Teri Westerby publicly thanked the landowner for acknowledging the need for more school space, and coming to the district with the purchase offer before others.
The deal has been quietly in the works for months now, and only was made public when a Nov. 13 special regular meeting was called to begin approving the bylaws needed to purchase the property.
Board chair David Swankey noted that the weighing of risks and benefits was “important consideration for public to be aware of.
“It is measured, it’s contextualized by the benefit of a new school site on Promontory which is something we have wanted for quite some time,” he said.
“I didn’t think something like this was ever going to come our way,” added trustee Carin Bondar.
“Let’s get ‘er done,” added trustee Richard Procee.
While the purchase price is about $9.1 million, the district will now borrow up to $6.5 million from the bank, with more than $200,000 a year in interest. They’ll be using about $3.1 million from the school site acquisition fund. The $9.5 million figure includes GST, due diligence, appraisal and legal fees.
The next step for the board, will be advocacy to the ministry of education to ensure the government covers the borrowed portion in future budgets.
Trustee Margaret Reid was absent.