The St. Croix River Education District (SCRED), a six-member educational cooperative district, provides special education and alternative learning programs in east-central Minnesota. Three of its member districts, Pine City, Hinckley-Finlayson and East Central, have a long history of working together on the SCRED-operated “Vision” program, which serves students with emotional and behavioral disorders. Due in part to space needs and an expiring lease, the three cooperating districts needed a new location for the program. With no taxing authority of its own, SCRED was reliant on its member districts to finance the purchase and build out of a facility.
SCRED engaged Ehlers’ School Finance Team for Debt Planning & Issuance Services. Ehlers modeled multiple scenarios for a Board-Approved Lease Levy for the purchase and buildout of a former grocery store in Pine City and coordinated with Districts’ attorneys to structure a financing agreement between the three Districts and SCRED. With the building being near Pine City Schools, that District agreed to serve as the fiscal host and issue the financing on behalf of the other Districts.
The School Boards of SCRED and all its member Districts approved the lease-levy proposal, allowing the Pine City School District to issue approximately $5 million in debt to fund the project. The building was purchased in 2021 and the build out was completed in November 2022. While Pine City is ultimately responsible for making the payments on the financing, the Hinckley and East Central School Districts have coordinated with SCRED to share in the cost through their available levy authority and general fund. In the end, it’s the students who win with this centralized facility serving the three communities and better meeting students’ programming needs.