CLEARFIELD – The Clearfield school board heard an update on the status of the first step in its bond refinancing plan from Business Administrator Sam Maney at Monday night’s workshop meeting.
On Sept. 26 the board authorized for the administration to move forward in the process of issuing General Obligation Bonds, Series of 2016, according to previously published GANT News reports.
More specifically, it authorized the administration to work with Public Financial Management Inc., the district’s independent financial advisor; Eckert, Seamans Cherin & Mellott LLC, the district’s bond counsel; and the district’s solicitor.
The proceeds of the G.O. Bonds, Series of 2016, will be used toward the advance refunding of the district’s G.O., Series of 2014, bonds. The district has plans to proceed with a competitive Internet auction with a minimum savings target of 3 percent.
The district currently has three viable refinancing opportunities in its $7.16 million in G.O. Bonds Series of 2011; its $9.995 million in G.O. Bonds Series of 2012 and its $9.54 million in G.O. Bonds Series of 2014.
With there being three series of G.O. bonds, the district heard a proposed three-step refinancing plan at its September workshop meeting that was presented by Jamie Doyle of Public Financial Management.
Originally, Doyle projected that the district would realize a net savings of $666,631 by doing an advance refunding of the 2014 bond series. However, she advised Maney on Monday that interest rates have started “creeping up.”
“It’s now more like $460,000”, he said. “It’s still above our 3 percent target; it’s up over 5 percent. But I think it’s a sign of the election approaching and so there’s been movement in the interest rates.”
According to Maney, Doyle asked if the district still wanted to proceed with the competitive Internet auction. He said she also mentioned that in the past she’s called them off within five minutes of the sale.
“As of now, the savings is still there and it’s still worth it,” he said. “The district’s net savings just isn’t going to be as high as projected.” Maney added that if there would be any substantial change, he would bring it to the board’s attention next week.
In other business, at its regular meeting next week, the board will consider incurring debt with the other sending districts to the Clearfield County Career & Technology Center and authorizing the center’s administration to work with its bond counsel and solicitor to proceed with the Series of Guaranteed School Lease Revenue Bonds, Series of 2016.
The proceeds of which will be used towards the refunding of the CCCTC’s Series of 2011 bonds with a minimum net savings of $200,000. “It’s nothing more than a refunding,” Maney explained. “… Every sending district guarantees those bonds.”
The CCCTC’s refunding is similar to that of the school district, he noted, other than CASD is targeting a 3 percent minimum net savings and the center a flat amount.