School Board Seeks $3.5 Million In Bonds

FARMINGTON — In a special meeting last week, Farmington School Board approved a resolution that would allow the school district to issue $3.5 million in second-lien bonds.

Bryan Law, superintendent of schools, said the $3.5 million bond issue would enable Farmington to move forward into planning Phase 3 of the high school campus. Phase 3 includes a new football stadium, indoor practice facility, track, fieldhouse and other amenities.

Law on Thursday said $ 3.5 million would more than jumpstart Phase 3.

“It’s a significant portion of what we want to do there,” Law said.

The estimated price tag for Phase 3 is about $7 million, Law said, adding revenue from the second-lien bond issue would put the “worst part of it behind us.”

Kevin Faught with Stephens Investments Inc., said he would apply to the Arkansas Department of Education for approval for the district to issue the bonds.

Faught said the district would offer the bonds Dec. 13 and open bids Dec. 19. The closing would be at the end of the year and then the school would receive its money.

If the school does not receive an acceptable interest rate, it is not obligated to issue the bonds, Faught said.

The district’s annual debt payment on the second-lien bond issue would be about $235,00 and this will come out of the district’s operating budget, beginning with the 2017-18 school year.

“I don’t see any downside to this,” Law told board members. “It seems all positive. What we’re doing is that we’re getting in the game.”

Law said several factors will help

Farmington in paying for Phase 3.

Student growth means the school will receive more money from the state. In addition, assessed value of property within the school district boundaries has increased. Increased revenue from both of these should be enough to pay 50 percent of the debt service for the second-lien bond issue, Law said.

If rates remain low, school officials will look at restructing about $ 8.4 million in debt next year to provide savings in interest costs. This savings also would help with paying for Phase 3, Law said.