New Bloomfield residents will soon see work start on facility projects funded through the $2 million no-tax increase bond issue, which voters passed in April. The bond issue will address facility repairs, among which the biggest projects are parking lot repairs and new heating and cooling systems in the district.
The New Bloomfield R-III Board of Education awarded a bid for the HVAC project to Clearview Enterprises LLC, a company which has done work in the Jefferson City and Columbia school districts previously. Bids for the project came in less than the district and its architect expected.
For the project, the company will swap out heating and cooling units in the district. The project will not require construction and Superintendent David Tramel said the process will not be invasive.
While work will start this summer on that project, Tramel said it's important to note that not all of the bond issue facility projects will be completed by August. The district, he said, wants to do the projects right and doesn't want to rush to fit everything in this summer. The parking lot project, for which bids will open later this month, may not begin repaving until next summer. The district and its architect will continue to work on projects and planning during the school year.
Additionally, the district's financial adviser, L.J. Hart and Co., will begin to solicit investors for the bonds.
The New Bloomfield R-III Board of Education approved the sale and issuance of the bonds, which will be available for local individuals and institutional investors, at its regular meeting Thursday. L.J. Hart now has the board's permission to find investors for the bonds.
The board further approved the creation of a final terms committee, which will consist of Larry Hart of L.J. Hart and Co. as well as the district's superintendent and school board president. With the establishment of the committee, at the time the bonds are sold, the committee will sign off on the individual sales rather than the entire board of education meeting to approve each sale.
Two L.J. Hart representatives presented two options related to the selling of the bonds and bond repayment to the school board at its meeting Thursday. The representatives, Vice President Courtney Wegman and Financial Analyst Sarah Buczkiewicz, discussed the options with the board: one which would give the district a 20-year repayment plan and one with a 15-year repayment plan.
The board, with a recommendation from Tramel, approved the 20-year plan Thursday.
With the option the board chose, the L.J. Hart representatives said 1.35 million bonds will be sold at a premium. There will be more additional funds generated up front with this option compared to the other plan presented Thursday, which would have sold 1.2 million of the bonds at a premium. In exchange for generating more of that money upfront, the district will pay a slightly higher interest rate for the first five years of financing, the representatives said. With the 20-year plan, the average interest rate is 4.42 percent. The 15-year plan had a lower average interest rate of 4.17 percent. However, after five years the district will have opportunities for bond refinancing and repayment.
Even though the 20-year plan has a higher interest rate, the L.J. Hart representatives said it allows for more flexibility. They further said the impact on the district's debt service fund balance will be less each year because it is spread out over 20 years, with opportunities for early repayment and refinancing.
If an unforeseen project were to arise that needed immediate attention, the district could do that project sooner with the 20- year plan than with the 15-year plan. Also with the 20-year plan, if in five years the project is complete and no unforeseen problems arise, the district will have the option to change the current bond issue to the 15-year plan. But with the 15-year plan, the district would not have the option to lengthen the term to 20 years.
Regarding the 20-year plan approved, Tramel described it as a "mirror image" of what the district has done with past bond issue experiences.