School board directors OK another bond issue
The Warren County School District will require another bond issue to fully fund construction projects currently underway throughout the district.
The school board has approved a “not to exceed” resolution that allows the district to issue additional bonds as long as the issuance is under the total limit in the resolution.
Dr. Norbert Kennerknecht, district director of buildings and grounds, said, “Looking into the future, without something catastrophic happening in between which we don’t see coming, that should address the rest of those projects.”
Administration approached the school board’s Finance Committee with a bond issue amount of $4,245,000.
“That’s our closest (estimate), looking into the future,” he added.
But as discussion stirred on starting to look at a renovation of Warren Area High School, the possibility of a larger issue exists.
Federal law states that the district is limited to issuing no more than $10 million in bonds per year. To comply with that regulation, a December sale with January 2014 closure date is expected.
Kennerknecht said the district’s financial advisors will “look over the whole situation, the big picture,” including borrowing rates, the status of the financial markets, interest rates and other factors to make a determination on the exact date, and size, of this issue. He also explained that there is an “economies of scale” component in play here as well where the district may be able to avoid, for example, paying for two sets of closing costs if some of the costs for WAHS can be lumped in now.
The first step in renovating WAHS is to obtain a set of educational specifications, which Kennerknecht estimated as a four -to six-month process at between $25,000 and $35,000 “Then (having the) conceptual requirements, (it) becomes the instruction to the architect on how to shape the project. The architect work is about a year long. Within that context, there is still surveying that has to be done.”
With those other costs facing the district before the renovation can concur, it may make sense to push toward that $10 million limit on this upcoming bond sale.
“It depends on what our financial advisors say,” he said. “It would be money that would be used (and) has to be spent within three years once you get it. It’s not only for finishing these jobs but for commencing not only the design process but also the construction” at WAHS.
The borrowing resolution from the board that permits this issue does not specifically include WAHS so Kennerknecht said that the advisors will also be looking “from both sides to see what is in our best interest” and whether a specific resolution for that project is needed.