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The Rolla Daily News - Rolla, MO
  • St. James School board approves bond resolution

  • At a regular meeting of the St. James R-I School District Board of Education March 20, a refunding bond resolution was approved.
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  •  At a regular meeting of the St. James R-I School District Board of Education March 20, a refunding bond resolution was approved.
    It authorized the sale of $3 million in general obligation refunding bonds at an average interest rate of 1.29 percent, compared to the Series 2010 refunded bonds, which carry an average interest rate of 3.11 percent.
    Through this refinancing the school district plans to reduce future interest expense by $220,347 from the Series 2010 bonds.
    This $220,347 plus the savings of $140,079 from the Series 2010 refunding and $294,063 of savings from the Series 2005 refunding means that the district will have saved a total of $654,489 on the original nearly $7 million Series 2001 bond issue without increasing the 53-cent debt service fund levy.
    When the net interest savings from issuing $3.7 million of combined zero interest qualified school construction bonds and qualified zone academy bonds in 2010 of about $2,057,056 is included, the grand total of savings will become $2,711,545.
    The Series 2001 bonds were issued for the construction of the new St. James middle school and gymnasium at the elementary school.
    Superintendent of Schools Dr. Joy Tucker expressed enthusiasm and support for the refunding option selected by the board of education.
    “This plan achieves good savings, while preserving considerable flexibility for the district to develop long-range capital facilities improvement plans,” Tucker said.
    St. James School Board President Larry Rinehart pointed out that the $220,347 of interest savings for the Series 2014 refunding is not all the district may realize because the Series 2014 refunding bonds has a call feature in three years at no penalty.
    “If interest rates are lower in 2017 or later, we can take advantage of that,” Rinehart said. “Meanwhile we are locking in these levels that are about 2 percent lower than they were in 2010.”
    L. J. Hart & Company of St. Louis prepared the refunding proposal and explained how it can fit into the long-range plans of the district.
    Thomas J. Pisarkiewicz, vice president/CFO of the firm, mentioned that the three significant factors making the Series 2010 refunding possible were the lower interest rates compared to the ones in 2010, the fact that the Series 2010 bonds were subject to prepayment on and after March 1, 2014, at no penalty and the district’s ability to participate in Missouri’s direct deposit program.
    This program makes it possible for the district to receive an “AA+” rating from Standard & Poor’s Corporation on the refunding bonds.
    Pisarkiewicz complimented Tucker and Charity Satterfield, board secretary, for their prompt and thorough preparations to supply the data necessary for the rating application and official statement, as well as the board of education for their foresight in making the Series 2010 bonds callable in four years.
    According to Pisarkiewicz, First Community National Bank bought $565,000 of the bonds and the Maries County Bank purchased $325,000 of the bonds.
    Page 2 of 2 - The bonds were also offered to other local institutional and individual investors.
    Tucker said she was pleased efforts were made to accommodate investors from within the St. James community and surrounding area.
    “It is nice that our marketing procedures facilitated this local involvement while still receiving attractive interest rates,” Tucker said.
    The Series 2014 refunding bonds were underwritten by L.J. Hart & Company.
    The closing for the Series 2014 refunding bond issue will occur April 9, 2014.
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