New Kensington-Arnold to pocket $1.8M in bond refinancing
Thanks to a favorable bond market, New Kensington-Arnold School District expects to save about $1.8 million by refinancing.
The board on Thursday unanimously agreed to refinance $19.8 million from bonds originally issued around 1995 to finance the Valley High School renovation project. Those bonds were refinanced once before, in 2002.
The district's bond underwriter, Joseph Muscatello with investment banking firm Boenning & Scattergood, last month approached the board about the possibility of saving at least $850,000 by refinancing.
Board President Bob Pallone said improving market conditions this month boosted the one-time savings to $1.8 million.
Muscatello previously said the refinancing would not extend the district's debt payments; the bonds still will mature in 2026.
Muscatello has said only one of the district's four bond issues is available for refinancing.
The school board issued $5 million in bonds in 2008 to finance several capital projects, including construction of the multipurpose building behind Valley Memorial Stadium, renovation of the stadium and installation of artificial turf, and replacement of the high school roof.
In 2010, the board refinanced $3.3 million from a 2005 bond issue. The district was only expected to save about $50,000 on that smaller reissue.
Cyber school savings
Another way in which the district is saving money is by offering its own cyber school to students who don't want to attend traditional school.
High school Assistant Principal Jeff Thimons reported about 45 students in grades six through 12 this year began using the district's cyber program, Odyssey.
Superintendent George Batterson said keeping those students in a district-run program means saving at least $500,000 this year in tuition that otherwise would be paid to outside cyber schools. The district would have to pay tuition of $11,000 per mainstream student and $18,000 per special education student.
Only one student this school year opted to leave the district for an external cyber school program, Thimons said. That child joined about 50 other students from kindergarten through 12th grade who already attended outside cyber schools prior to this school year.
"In years to come, if that trend (of students choosing New Ken-Arnold's cyber program) continues, we should have very few leave the district, which saves us money," Batterson said.
In addition to using the Odyssey program, originally purchased for use by alternative education students, the district is working with the Westmoreland Intermediate Unit to create its own online curriculum.
Pallone and board member Pat Petit indicated they were glad the district was retaining students and tuition dollars, but questioned why nearly 100 students were opting out of the traditional classroom experience.
"We need to know the root cause of why they're leaving," Pallone said.
Administrators indicated they could survey students on why they use the cyber program. Board member Deb Glushenko said she'd like to know how New Kensington-Arnold's percentage of cyber students compares to that of neighboring districts.
Batterson agreed that, ultimately, educators would prefer to keep all students in the classroom: "In a way, we really don't want them to go to our cyber school."