A proposed Palmerton Area School District project that would move sixth grade students and the district administrative offices to the junior high/high school campus, while securing the high school entrance, would require borrowing money, financial officials said Tuesday night.

Zach Williard, managing director at RFM Financial Advisors LLC, told school board members a phased borrowing approach could accommodate its projected financing needs over the next several years.

While several options are still on the table for the project, an early estimation pegs the work around $15 million.

“You’re looking at a scenario where you might borrow just under $5 million in 2026, approximately $9.6 million in 2027, and about $3.1 million in 2028,” Williard said. The goal of this structure, he explained, is to ensure funds are available as the district moves through each phase of construction, while keeping in compliance with federal tax laws requiring 85% of borrowed funds to be spent within three years.

“Interest rates have been high over the past couple of years, but municipal borrowing rates are generally lower than personal lending rates because school districts can issue tax-exempt debt,” Williard said.

Williard also addressed the impact of federal interest rate policies on borrowing costs, explaining that while federal rate cuts can influence municipal bond rates, they do not always correlate directly.

“We focus on long-term rates, which are affected by inflation reports and other market conditions,” he noted.

During Tuesday’s board workshop, Williard outlined the district’s existing debt obligations and how new borrowing would be structured to minimize budgetary impact.

“We use a wraparound debt structure, which means lower payments upfront and increasing payments later, as older debt gets paid off,” he said.

Under the proposed financing plan, the district’s annual debt service would gradually increase from $2 million to approximately $2.9 million by 2029. The district is also considering using reserve funds to smooth out the budgetary impact over four years.

“This would allow for a more gradual increase in debt service, rather than a sharp rise in any single year,” Williard said.

Construction and realignment

Highlights of one of the latest PASD options include moving sixth grade to the junior high/high school campus; relocating the main high school entrance to a new two-story addition off the east parking lot; and moving the district’s administrative offices from Parkside Education Center downtown to a new addition connected to the west side of the junior high school gymnasium.

The two-story addition at the high school’s east end would consolidate high school and junior high entrances into a shared zone.

The first floor of the addition would house the administrative offices, guidance counselors, and the nurse’s suite. The second floor would provide additional classroom space to accommodate future grade realignments.

The proposal includes creating a secure vestibule at the new main entrance and ensuring that gymnasium and auditorium visitors have separate, secure entrances during events.

According to KCBA Architects, Palmerton would gain eight new classrooms under this option.

“This option makes better use of our facilities while keeping overall costs manageable,” Board President Earl Paules said. “We need to move on this if we want to get anything done in 2026-27. We have a history of dragging our feet here in Palmerton and we don’t react to anything.”

Next steps

Paules proposed putting voting on the option at the district’s Feb. 18 board meeting.

Directors such as Sherry Haas, however, said there are still unanswered questions that need to be addressed before she could vote yes.

“I am a million percent for making this district safer, but I have some concerns about where the sixth grade classrooms would be under this option because they would essentially be in the high school,” Haas said.

Others also called for additional board discussion.

“This is extremely important to everybody,” board member Kris Schaible said. “I don’t think this means we aren’t going to do anything. I feel like everyone has an intention of moving forward. All we’re asking for is continued discussion.”

Paules, though, expressed disappointment with delaying the process any further.

“It took a year and three months to redo a little wrestling room that was 30 feet wide by 100 feet,” he said. “If we push things out to March, we’re going to miss our deadlines to get anything done in 2026-27.”

Superintendent Angela Friebolin asked directors Tuesday to send her any questions or concerns they’d like to see addressed in an effort to move discussion forward.