Bond Refinancing Saves $3M For Warsaw Schools
July 28, 2016 at 4:25 p.m.
By David [email protected]
Monday night, the school board and the building corporation approved resolutions authorizing the refinancing. The board also heard about the procedure for the 1028 hearing on May 21 at 7 p.m. for the potential school building project.
Todd Samuelson, of Umbaugh & Associates, Plymouth, said in March the school board had Umbaugh & Associates prepare the paperwork for moving forward on refinancing the bond issue. No decisions were made at that time.[[In-content Ad]]When the presentation was made in March, he said the school board was told $2.7 million would be generated to be placed in the construction fund. Monday, Samuelson said he feels the school corporation can do a little better than that now.
"We're hoping we'll push that number closer to $3 million," said Samuelson.
Dan Robinson, school board vice president, said the $3 million figure is based on getting an interest rate of 4 percent. He asked what happens if the school corporation doesn't get a rate that low.
Samuelson said the refinancing resolution doesn't mean the school board will take whatever they can get. The refinancing will be shopped around for the best deal. The resolution also states that the refinancing must generate cash of at least $2.5 million.
With the $2.5 million, school board member Delores Hearn said that puts the school corporation an additional $1 million in debt. Samuelson said they had to look at the value of getting the cash in hand now versus the future value. Of course the school corporation can expect an interest component down the road on the money now.
Robinson asked if the school corporation could pay more on the principle now so it has less to pay later. Samuelson said they could not because when refinancing is done, there are parameters put in place as to what the maximum payment can be. Back in 2003, during the public process, parameters were set as to what the maximum payments on those bonds could be and "we're at that now."
Robinson asked the finance committee what their position on the refinancing was. Deb Wiggins, school board and finance committee member, said they reviewed the information, asked questions about it, and felt this was the right first step in getting started on the building project.
The resolution to authorize the refinancing was approved by the school board unanimously. The building corporation then met briefly and also approved a resolution approving of the refinancing. Two of the three members of the building corporation were present, including Bill Landrigan and James E. Elizondo. President Dr. Lee Harman was absent.
Earlier in the meeting, Samuelson reviewed the process for the 1028 hearing.
The 1028 hearing, he said, is a legal step in the process that the school corporation needs to take on before beginning the process of taking on a construction project of more than $1 million. The purpose of the hearing is to allow the public to come, receive information and provide comments. Monday's hearing will be the first item on the school board's agenda after the pledge, moment of silence and roll call.
Thomas Peterson, legal counsel with Ice Miller LLP, Indianapolis, will open the 1028 hearing. He will lay the ground work on why the school corporation is having the meeting, said Samuelson. Warsaw Schools Superintendent Dr. Robert Haworth then will make a presentation on the need for the building project. Next, Kovert Hawkins, Jeffersonville, architectural firm, will provide information on the building program that addresses the needs. Umbaugh & Associates will provide information on the funding structure for the project.
After all those presentations, the public then will be given time for public comments and questions. After the public hearing portion is complete, the school board then will consider two resolutions to determine whether to proceed forward with the building project.
The 1028 hearing on May 21 at 7 p.m. will be in the training room of the administration building.
At the end of the 2003-04 school year, Atwood, Silver Lake and Claypool elementary schools were closed. Since then, students at those schools have been transported to other schools, causing overcrowding.
The school board interviewed five architectural firms, eventually choosing Kovert Hawkins to oversee a possible building project. Kovert Hawkins developed three options. Option A - which keeps the sixth grades in the elementary schools, expands and renovates several elementary and middle schools, and builds new Madison and Leesburg schools - was chosen.
Total cost of Option A is approximately $100 million.
Warsaw School Board members are Robinson, Wiggins, President Ron Yeiter, Hearn, Tammy Dalton, Secretary Gene England and Chuck Sauders.
Monday night, the school board and the building corporation approved resolutions authorizing the refinancing. The board also heard about the procedure for the 1028 hearing on May 21 at 7 p.m. for the potential school building project.
Todd Samuelson, of Umbaugh & Associates, Plymouth, said in March the school board had Umbaugh & Associates prepare the paperwork for moving forward on refinancing the bond issue. No decisions were made at that time.[[In-content Ad]]When the presentation was made in March, he said the school board was told $2.7 million would be generated to be placed in the construction fund. Monday, Samuelson said he feels the school corporation can do a little better than that now.
"We're hoping we'll push that number closer to $3 million," said Samuelson.
Dan Robinson, school board vice president, said the $3 million figure is based on getting an interest rate of 4 percent. He asked what happens if the school corporation doesn't get a rate that low.
Samuelson said the refinancing resolution doesn't mean the school board will take whatever they can get. The refinancing will be shopped around for the best deal. The resolution also states that the refinancing must generate cash of at least $2.5 million.
With the $2.5 million, school board member Delores Hearn said that puts the school corporation an additional $1 million in debt. Samuelson said they had to look at the value of getting the cash in hand now versus the future value. Of course the school corporation can expect an interest component down the road on the money now.
Robinson asked if the school corporation could pay more on the principle now so it has less to pay later. Samuelson said they could not because when refinancing is done, there are parameters put in place as to what the maximum payment can be. Back in 2003, during the public process, parameters were set as to what the maximum payments on those bonds could be and "we're at that now."
Robinson asked the finance committee what their position on the refinancing was. Deb Wiggins, school board and finance committee member, said they reviewed the information, asked questions about it, and felt this was the right first step in getting started on the building project.
The resolution to authorize the refinancing was approved by the school board unanimously. The building corporation then met briefly and also approved a resolution approving of the refinancing. Two of the three members of the building corporation were present, including Bill Landrigan and James E. Elizondo. President Dr. Lee Harman was absent.
Earlier in the meeting, Samuelson reviewed the process for the 1028 hearing.
The 1028 hearing, he said, is a legal step in the process that the school corporation needs to take on before beginning the process of taking on a construction project of more than $1 million. The purpose of the hearing is to allow the public to come, receive information and provide comments. Monday's hearing will be the first item on the school board's agenda after the pledge, moment of silence and roll call.
Thomas Peterson, legal counsel with Ice Miller LLP, Indianapolis, will open the 1028 hearing. He will lay the ground work on why the school corporation is having the meeting, said Samuelson. Warsaw Schools Superintendent Dr. Robert Haworth then will make a presentation on the need for the building project. Next, Kovert Hawkins, Jeffersonville, architectural firm, will provide information on the building program that addresses the needs. Umbaugh & Associates will provide information on the funding structure for the project.
After all those presentations, the public then will be given time for public comments and questions. After the public hearing portion is complete, the school board then will consider two resolutions to determine whether to proceed forward with the building project.
The 1028 hearing on May 21 at 7 p.m. will be in the training room of the administration building.
At the end of the 2003-04 school year, Atwood, Silver Lake and Claypool elementary schools were closed. Since then, students at those schools have been transported to other schools, causing overcrowding.
The school board interviewed five architectural firms, eventually choosing Kovert Hawkins to oversee a possible building project. Kovert Hawkins developed three options. Option A - which keeps the sixth grades in the elementary schools, expands and renovates several elementary and middle schools, and builds new Madison and Leesburg schools - was chosen.
Total cost of Option A is approximately $100 million.
Warsaw School Board members are Robinson, Wiggins, President Ron Yeiter, Hearn, Tammy Dalton, Secretary Gene England and Chuck Sauders.
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