School Board Sells Mil­lions In Bonds

Washington County Enterprise-Leader - - FRONT PAGE - By Lynn Kutter

FARM­ING­TON — Farm­ing­ton School Board re­ceived two bids to sell $29.5 mil­lion in re­fund­ing and con­struc­tion bonds and ap­proved a low bid of 3.69 per­cent in­ter­est rate from Robert W. Baird & Co., Inc.

Kevin Faught with Stephens Inc., of Fayet­teville, said the firm had hoped to re­ceive more than two bids for the bond is­sue but be­lieves over­all, the school re­ceived a good bid.

“Bond rates are on a roller coaster,” Faught told board mem­bers at their Aug. 27 meet­ing. “They are up and down. They were up a lit­tle when we did our sale.”

Vot­ers in the May 22 school elec­tion sup­ported the school dis­trict’s re­quest to re­fi­nance five bond is­sues and ex­tend debt an­other 35 years. The dis­trict re­fi­nanced five is­sues that to­taled $19.4 mil­lion in prin­ci­pal and of­fered a new bond is­sue with a prin­ci­pal amount of $29.5 mil­lion.

The new is­sue in­cludes $9.3 mil­lion in new money that will be ded­i­cated to Phase 3 at the high school, with some left­over for projects at what is now Farm­ing­ton Ju­nior High.

Bryan Law, su­per­in­ten­dent of schools, said the sale gen­er­ated more rev­enue that ex­pected.

“All in all, this is good or bet­ter than what we hoped for,” Law said. “We were very happy that day.”

The pro­ceeds from the sale will be avail­able to the school Sept. 4. Bond trustee will be Bank OZK in Lit­tle Rock.

The first pay­ment will be due Fe­bru­ary 2019 and the dis­trict will make two in­ter­est pay­ments and one prin­ci­pal pay­ment each year. The an­nual debt ser­vice for the new bond is­sue will be about $1.63 mil­lion for prin­ci­pal and in­ter­est, ac­cord­ing to Faught. Faught said this debt ser­vice is about the same pay­ment the dis­trict was mak­ing for the five bond is­sues that were re­fi­nanced.

The to­tal cost for Phase 3 will be $15.9 mil­lion, which in­cludes $1.2 mil­lion for site work and $11 mil­lion for the base fa­cil­i­ties pack­age: new foot­ball/soc­cer sta­dium, track, foot­ball bleach­ers, press­box, con­ces­sion stand/re­strooms, ticket

booth and a field house with of­fices, locker rooms and a weight room.

An­other $2.7 mil­lion is for an in­door prac­tice fa­cil­ity and cheer/dance locker rooms, $700,000 for the util­ity pack­age and $318,000 for other costs, such as bleach­ers and a press­box for the track fa­cil­ity and two park­ing lots.

The dis­trict is fi­nanc­ing Phase 3 with pro­ceeds from the new bond is­sue and money from its cap­i­tal im­prove­ments re­serve fund.

In other ac­tion, the School Board ap­proved the 2018-19 school bud­get, which is very close to the bud­get for 201718, said Mandy Uher, dis­trict trea­surer.

The bud­get shows a be­gin­ning bal­ance of $748,325 with ex­pected rev­enues and pro­jected ex­pen­di­tures of al­most $21 mil­lion.

Pro­jected rev­enues in­clude $12.6 mil­lion from the state in state equal­iza­tion aid, $5.6 mil­lion in prop­erty taxes, $925,000 from Act 79, $444,470 from Na­tional School Lunch Stu­dent fund­ing and $300,000 in delin­quent taxes.

Pro­jected ex­pen­di­tures in­clude $10.3 mil­lion for the teacher salary fund, $3 mil­lion for ben­e­fits for cer­ti­fied and clas­si­fied staff, $1.3 mil­lion for op­er­a­tion ex­penses, $1.6 mil­lion for clas­si­fied salaries, $864,723 for util­i­ties and insurance, $547,000 for cus­to­dial fees and $478,041 for main­te­nance.

The bud­get also in­cludes trans­fer­ring $167,000 at the end of the year to the dis­trict’s cap­i­tal im­prove­ment fund, leav­ing an ex­pected year-end bal­ance of $749,105.

In other busi­ness, board mem­bers, after much dis­cus­sion, ap­proved a rec­om­men­da­tion from Law to lease a new band truck for the next five years in­stead of pur­chas­ing a truck.

Law said school of­fi­cials have looked for a band truck to pur­chase but costs are high on ve­hi­cles with lots of mileage.

The school will rent a 26-foot truck for $1,230 per month for five years. At the end of the pe­riod, it will have the op­tion to pur­chase the ve­hi­cle at mar­ket value. The agree­ment in­cludes main­te­nance on the truck and 24-hour emer­gency road ser­vice.

“I’m typ­i­cally not a leaser my­self but I’ve had to weigh this,” Law said. “With this sit­u­a­tion, it seemed like the best op­tion.”

Board mem­ber Doug Wil­liams agreed he did not like to lease but added, “Some­times you have to bite the bul­let.” Wil­liams noted a lot of peo­ple were de­pend­ing on the truck and tim­ing seemed im­por­tant to get some­thing in place for the band pro­gram.

LYNN KUTTER EN­TER­PRISE-LEADER

Work­ers with NEC Inc., of Rogers, work on the long jump for the new Farm­ing­ton High School track. The School Board last week ac­cepted a bid for a new bond is­sue, with part of the pro­ceeds from the bonds ded­i­cated to help­ing pay for Phase 3 of the high school cam­pus.

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