FSCC trustees to finish paperwork for fine arts center

The Fort Scott Community College Board of Trustees is preparing to review two agreements concerning financing and ownership of the $7.7 million Danny and Willa Ellis Family Fine Arts Center at FSCC.

During their regular meeting on Monday, Zachery Reynolds, an attorney representing FSCC, presented information to the board regarding legal documents that college officials will need to sign before construction on the 33,000-square-foot facility gets under way next month. The board plans to officially vote on approval of the agreements, which are required with the issuance of state-approved revenue bonds, during their January meeting, officials said.

One of the documents, called a site agreement, explains that FSCC will lease land owned by the college to the City of Fort Scott for purposes of constructing the fine arts center. The city has issued $4.4 million in industrial revenue bonds -- which the FSCC Endowment Association will repay over the next 15 years -- to help pay for the facility, which will be built on a plot of land located just east of the FSCC Administration Building.

The bonds will help save the college money on financing of the fine arts center, because they will be exempt from federal income tax and are offered with low interest rates. The bonds will also address cash flow issues the college has experienced recently, while allowing construction of the center to begin soon, and will pay for construction costs, as well as equipment, furnishings and fixtures inside the building, officials said.

The site agreement outlines an agreement between the City of Fort Scott and the FSCC Endowment Association; the latter of which will use more than $6 million in collected pledges and donations to help repay the bonds. FSCC and the City of Fort Scott will not be obligated to repay the bonds, a responsibility that falls solely on the Endowment Association, Reynolds said.

"The agreement brings use of the land and puts it in the hands of the Endowment Association," he said. "They will receive the benefit of the money from the bonds."

In the agreement, the Endowment Association will be allowed to use land owned by the college to build the fine arts center using money the association has raised over the last two years, and bond money. The association -- the college's non-profit fund raising department -- will pay for the bonds as pledges and donations continue to come in over the next five to 10 years, and will continue raising money to pay for the center until early 2009, when the facility is scheduled to be completed.

FSCC has also already donated $1.5 million toward the fine arts center, an amount that should pay for interest on the bonds ($100,000 per year) over the next 15 years. FSCC officials have chosen to use a slight increase in student fees -- about $2 per credit hour starting this year -- to pay for the college's commitment, FSCC Dean of Finance and Operations Darcy Baldonado said.

The second agreement is an operating agreement between FSCC and the Endowment Association that will ultimately "give full and absolute use of the facility to FSCC," which will own and operate the fine arts center, and pay for any maintenance the building requires once it becomes operational, Reynolds.

The construction site is currently undergoing preparations for eventual construction of the facility itself sometime in January. In recent weeks, crews have been excavating land for the installation of utility lines and cables that will take place this week. Testing of all underground lines and cables that will run into a system beneath the construction site will begin next week, FSCC officials said.

The board also conducted the following business on Monday:

* Acknowledged receipt of the annual audit report on the college's nearly $12 million budget from the fiscal year that ended June 30, 2007. Local certified public accountant Terry Sercer said the college received a "clean" audit report that showed no violations in state or federal law.

* Approved the October treasurer's report, which showed a $2.4 million starting cash balance, $2.7 million in expenses, $2.4 million in revenue, and a $2 million ending cash balance.

* Approved the resignations of head volleyball coach Angie Kemmerer and assistant volleyball coach Stephanie Newport, and hired Ian Cook as a network specialist, Judy Meister as an occupational recruiter, Kay Bunn as a professional staff member in the Maximized Individual Learning Laboratory, and Alfred "Clint" Herd as an instructor in the Kansas City Truck Driving Program.

* Heard a report from FSCC President Clayton Tatro and trustees Robert Nelson and Curt Shankel on a recent Kansas Association of Community College Trustees and Council of President's meeting conducted Dec. 3 at Labette Community College.

The board also conducted a brief executive session and later adjourned.