IT lease deal to net Niles schools $600K

Published 9:20 pm Saturday, November 18, 2006

By By ANDY HAMILTON / Niles Daily Star
NILES – A proposed lease with a business technology company is expected to net Niles Community Schools more than $600,000.
Superintendent Doug Law said Friday the district has negotiated the lease of bandwidth to SourcIT of Grand Rapids. A resolution at Monday's regular meeting of the board of education must be passed before the contract is official.
Law said the Federal Communications Commission gave Niles schools the bandwidth, which provided the district with the ability to broadcast TV shows, more than 20 years ago. The FCC also made the donation to the school districts of Benton Harbor, Lakeshore, St. Joseph and Coloma.
"We never used it, never had the equipment, never had the desire," Law said.
About 10 years ago, Law said all five districts were approached by a company now owned by Sprint. An agreement was reached, he said, but the lease was never "executed," the districts never received compensation and the contract expires next year.
A "huge bidding war" over the bandwidth that would "leap by hundreds and thousands of dollars … in a matter of weeks" developed across the last year and an agreement was finally reached, Law said. SourcIT is set to lease from Niles and another district and Clearwire is contracting with the remaining three school systems, he added.
The proposed contract would include a payment up front of $620,000, plus a monthly lease payment of $100 for a length of 30 years, Law said. The same agreement, he added, has been reached among the other districts and Clearwire.
"The next thing is wireless communication and because we are at the gateway to Michigan when it comes to the Chicago crowd, ours is extremely valuable," Law said.
The FCC is expected to review and approve the lease by May 2007, but Law said the district would receive the payment during the current fiscal year.
So far, Law said the board of education has decided to use $180,000 toward covering the cost of new computer labs already completed in Howard, Ballard and Eastside elementary schools and about $40,000 will pay for meeting state requirements that all district employees be fingerprinted. The remaining money – about $400,000 – will be a "discussion topic" for the board of education, Law said.
Most likely, Law said, the board of education will wait until the first long range planning workshop Dec. 6 to discuss possible uses. The district currently has a $1.1 million deficit budget, but with possible cutbacks on state per pupil funding coming after the first of the year, Law said the money might be needed in a general fund.
"My guess is we will not do anything with the money until we see what happens with that," he said.
The regular meeting of the Niles Community Schools Board of Education is Monday at 7 p.m. at the Westside Administrative Services Center, 111 Spruce St.