Franklin Regional board sets stage to borrow $9.9 million for Sloan Elementary projects
Franklin Regional School District's financial adviser has recommended the board issue $9.9 million in bonds before the end of the year to begin work on a $54 million elementary campus.
The work would include renovations to Sloan Elementary and the construction of an elementary school next door.
Chris Bamber of PFM Financial Advisors said the board was inclined to look at issuing “bank-qualified bonds” that amortize in roughly 30 years.
Bamber said such bonds generally have lower interest rates and allow any tax increases that may be needed for such a project to be phased in more gradually.
Bamber proposed issuing $9.9 million in bonds next year and in 2020, as well, with a much larger, $23.65 million bond in 2019, when the bulk of construction work and spending would be taking place.
“You want to maximize the use of these bank-qualified bonds,” he said.
As it has done in the past, the board will set parameters for the bonds to give the district maximum flexibility when it comes to entering the market and pricing the bonds at the most opportune time.
• Maximum principal of $12 million.
• Maximum interest rate of 5.5 percent.
Bamber said a general timeline would see the district's financing team contact a rating agency next week and receive that rating in mid-October. The board could agree to the bond parameters Oct. 16. Pricing the bonds and executing a bond purchase agreement would happen in late October or early November, and bond settlement would take place by early December.