After reconsidering a decision to sell $10 million in voter-approved bonds, opting instead to sell half, the School Board on Thursday authorized the sale of the remaining $5 million.
The district plans to use the bond money for a series of improvements that include upgrading its phone and intercom systems.
The Board on Thursday also approved the use of about $31,000 in bond money to purchase new playground equipment at Joe Hamilton Elementary School.
Voters approved the $25 million school facilities bond in November 2008. The first bond sale helped fund Smith River Elementary School’s new gymnasium.
The gym’s new floor arrived last month and has been painted. Workers laid down the floor’s final lacquer Friday, Olson said. The floor must be undisturbed for seven days before the bleachers can be installed. The gym’s ribbon cutting is planned for the first week of February, Olson said.
The school district will sell no more than $5.01 million in bond money, said Superintendent Don Olson on Thursday. This most recent bond sale would have no effect on property tax rates, he said.
“You are giving us permission to move forward if the market is in a favorable position,” he told Board members.
The Board on Sept. 12 approved a resolution to increase property taxes to $54.50 per $100,000 of assessed property value in preparation for selling $10 million worth of bonds. Members approved that sale Sept. 26.
At a special meeting in October, Jon Isom, the district’s board consultant, told trustees that because they decided in June 2013 to re-fund the initial $5 million bond sold in 2009 to get a better interest rate, the district was ineligible to sell the whole $10 million bond until January. Moving ahead with the sale could jeopardize the district’s bank-funded status and invalidate the re-funded status of the previous bond, Isom said.
Bank-qualified bonds provide an incentive to banks to purchase “bonds of all sizes,” according to Isom.
Bank-qualified status also allows for better interest rates for taxpayers, according to Olson.
In October, Board members and district officials were disturbed when they learned that splitting the $10 million bond in half would result in a $25,000 cost of issuance fee. Isom said he would get the fee reduced by $19,000-$20,000.
On Thursday, the School Board approved the bond sale with the stipulation that Isom waive $18,000-$20,000 in cost of issuance fees.