Two major infrastructure projects from Cullman City Schools received significant advancement earlier this week when the Cullman City School Board awarded roughly $34 million in bids to two companies for the career tech/STEM wing at Cullman High School and the Cullman Intermediate School. However, a pending decision from the Cullman City Council could create some hiccups in the funding for those projects according to one member of the board’s legal counsel.

The board awarded a $10 million bid for the CHS classroom additions to Edison Construction during its meeting on Tuesday, Oct. 22. Wyatt Builds, a company based in Birmingham, Alabama, won the $24 million dollar bid for additions and renovations to West Elementary which, when completed, will consolidate all of the district’s third through fifth grade students under the new moniker of Cullman Intermediate School.

“It is exciting to work with a board and community that is hyper focused on growth and creating opportunities for our students to be successful while we have them and long after they graduate,” Superintendent Kyle Kallhoff said in a press release following the meeting. “Our students and community deserve safe and modern facilities, this is one reason why families want to reside in Cullman, Alabama.”

Construction on both projects is scheduled to begin in early 2025.

The day prior to the school board meeting, Monday, Oct. 21, the Cullman City Council met with Kane Burnette, a partner with Bradley Law Firm who specializes in serving as bond counsel for public entities and corporations, during a work session to discuss a proposed ordinance which would ratify the city’s contribution of a percentage of its half-cent sales tax to the school district.

The council noted how it had consistently provided CCS with a portion of the half-cent sales tax, but it had not necessarily been required to do so.

Burnette explained the board has already used the city’s 7.5 mill ad valorem tax and its portion of the Cullman County sales tax to secure a $30 million, 30-year bond and is requesting the additional pledge to secure a smaller loan of $2 million to cover an overage to complete its projects.

“I don’t mean this in a bad way, [but they are sort of maxing out what they can get on the [ad valorem taxes],” Burnette said.

Burnette said the ordinance would not obligate the city to the school board’s finances or indebtedness, but would codify an agreement that the city would continue to provide the funding for duration of the eight-year loan.

“It really just calls for the city to continue the status quo for as long as the board’s indebtedness for the intermediate school and the high school technical education and STEM wing is outstanding,” Burnette said.

City Attorney Roy Williams said the city had experienced problems with similar pledges in the past when the recipient had refinanced a loan and extended the city’s obligation. Burnette said he believed, because the bond was less than $10 million, that it was unlikely to be refinanced.

Following up with The Times by phone Friday, Oct. 25, Burnette said the school board’s finances were in a healthy position and that the pledge was primarily intended to reassure bond holders of a guaranteed revenue stream.

“Bond holders just want to see a 125 percent ratio and make sure that whatever has been pledged will continue,” he said.

Burnette said that if the council opts to deny the ordinance the board could be able to complete the planned projects, but it would “need to readdress its financials.” He said Alabama law requires 10 mills of ad valorem taxes to each public school district, but that the Alabama Department of Education preferred for boards to not borrow against those funds.

“We would just have to have a conversation with the ADOE,” he said.

The council held the required first reading of the ordinance Monday, but declined against suspending the rules which would have allowed immediate action with council members stating they would like more time to sit with the ordinance before reaching a decision. It plans to readdress the proposal at its next scheduled meeting Monday, Oct. 28.