The Orcas School Board has taken its first step toward acquiring non-voted debt.

Despite their reservations about owing money without a concrete revenue stream in place, four out of five board members voted to negotiate with two banks to sell $1 million in bonds.

“We represent the voice that can’t vote: the children,” board chair Janet Brownell said.

In February, the Orcas School District was offered $900,000 in federal grant monies to make repairs to the elementary school. To secure the grant, they must come up with $800,000 in matching funds to complete the entire project, which includes a new HVAC system, motion control heat and lighting, and replacing the galvanized plumbing with copper pipes. The improvements are estimated to save the school $13,000 a year in energy bills.

The deadline to complete the repairs is June 2012, so the work must be done this summer. The board’s plan, if they settle on a loan option, is to put a small capital levy before the voters to pay back the debt. The district wants to have $1 million as a cushion, in case the building has more problems than expected.

Board member Chris Sutton said he has heard from “so many people” who support accepting the grant that he “feels comfortable taking this risk.”

“I feel the community will pay us back,” he said.

Tony Ghazel urged his fellow board members to formulate a worst case scenario plan.

“We have $900,000 on the table. It’s very attractive. But we also don’t have a certain revenue stream,” he said. “How will we pay for this if the public says no?”

Jim Sullivan cast the lone dissenting vote, saying he has heard only negative feedback from the public.

“I find it agonizing to turn down this money, but I am opposed to it on principle,” he said.

The school is looking at two bank proposals. A Capital One offer allows the school to pay off the entire amount after only 10 years, while a Cashmere Valley Bank offer allows a pay-off at any time. The interest rate over 15 years is $186,000.

Business manager Keith Whitaker explained that with a $40,000 capital project fund balance, $52,000 in energy rebates from OPALCO, and energy savings, the school would have enough money to make payments for five years. The first two years of payments would only go to interest, not principal.

Scott Locke with University Mechanical Contractors, an energy performance contracting business, and Stu Simpson from the Washington State General Administration were at the meeting to answer questions. University Mechanical has been serving as the project manager, analyzing buildings, designing plans, and bidding the work out to contractors. Orcas construction firm Terra Firma Northwest and electrician Kevin Loomis are already on board to participate.

Audience member Chris Butler asked why the district is aiming to replace systems in the elementary school rather than repairing them.

“During the audit, we did look at just doing the repairs, but then the grant money became available for replacement,” Locke said. “You still have an aging system. Who knows how much life it has left.”

Before the board made its decision, audience members weighed in on the debate.

“I encourage the school board to make these repairs,” Hilary Canty said. “This is an example of a sturdy building that can last. The school board has done an excellent job of having a forward-thinking and fiscally responsible approach.”

Clyde Duke told the school board they need to “engage the community.” He called 12 local contractors and engineers to discuss the campus repairs. He said all of them expressed interest in evaluating repairs to the entire campus.

Teacher assistant Phil Branch encouraged the board to accept the grant money.

“This would allow for half of the cost to come from the government and not our tax dollars,” he said.

Teacher Mandy Randolph reminded the board that “it’s really about the kids.”

“The kids deserve to have clean, fresh air, warm air, and clean water,” she said. “It’s been hard to have students who don’t want to take their coats off or wash their hands in freezing cold water…they work hard and we need to work hard for them.”