I'm with Smitty on this one. I wouldn't pay more than $5000 for this. For comparison, I've been watching bus sales on Public Surplus in Washington State. Yesterday two comparable Thomas Saf-T-Liners sold for $2500 and $2650. Lower milage, 131K and 139K. Both RE with Cat 3116. Both 1991 model year and both high top. This is not out of line. In the past month I've seen several comparable Thomas and slightly older Blue Birds go for between $1600 and $3500, with the difference in price seeming to be driven mostly by mileage, then age. Most of these were direct from school districts, with Public Surplus acting as their selling agent. If you're going to do a conversion anyway, you'll be gutting the interior and repainting the exterior. So you don't necessarily need the prettiest bus, but rather a body with little or no rust, mechanicals in sound condition, and good tire tread. But for the difference in price between the above examples and the one you're considering, you could probably have the engine, transmission and air brakes all professionally overhauled, and maybe add brand new tires and air conditioning to boot.
FWIW, YMMV, just my opinion, which is worth exactly what you paid me for it.