With bonds on minds, South Side school board gets lesson
Audrey Bear from the financial advisory firm Robert W. Baird walked the South Williamsport Area School District’s board through bond options at the board’s Monday night meeting, reviewing the district’s debts and commending it for its relatively light debt load.
She contrasted the district’s debt payments before and after reimbursement from the state’s PlanCon program, which subsidizes certain facility costs and outlined how the district could proceed and what annual and monthly costs different options may pose. She also noted that the state no longer accepts new projects for reimbursement under PlanCon.
Bear said bonds are regulated by the IRS, state law and the state Department of Education, including rules pertaining to existing debt loads and how bond money may be used, including commitment of at least 5 percent of the funds almost immediately and 85 percent over three years. The rules also include due diligence requirements with a rating agency reviewing three years worth of auditing.
“We play by everyone’s rules,” Bear said.
She said the school district had an A+ rating as of three years ago and added that the two ratings agencies — Moody’s Investors Service and Standard and Poor’s — not only assess the district’s internal finances but the region’s economy and employment rates.
“They have to be able to pay their tax bills for you to pay your bills,” she said of district residents.
Bear outlined two payment structures — one under which the district would have lower payments at first as past debts are paid off before payments balloon, and another with level payments over the timeframe of the debt.
“Try to plan the best you can,” Bear advised.
Chris Branton, board president, asked Bear about the feasibility of refinancing existing debt, but Bear cautioned that since the district had been able to secure low interest rates, refinancing wouldn’t save the district any money. Superintendent Mark Stamm said the district could expect some more costly buildings and grounds expenditures within the next couple years. Stamm also said the board ought to be concerned that funding reserves earmarked for buildings and grounds are becoming depleted.
Stamm further noted that the district operates on a deficit, with a past surplus the district had built up covering the difference. He noted restructuring how debt is managed could help close the gap. Branton and Stamm said the report by Bear is something the board should keep in mind as decisions are made over the next few months.
Stamm also addressed school safety. The district, he said, is talking with South Williamsport borough about the addition of a hared resource officer and other security staff. Stamm said district employees recently completed active shooter response drills and the district will roll out age-appropriate instruction for all students. He said information has been mailed to families and should be arriving within the week and also is available on the district’s website.
In other business, the school board:
• Approved the hiring of a part-time custodian, Morgan Bauder, at a rate of $9 an hour for five hours a day, pending clearances.
• Approved Zach Welter as a junior varsity baseball coach and Art Hengler as an assistant track coach, for a stipend of $1,671 each.
• Approved field trip requests for Leo Club students to visit the Beacon Lodge in Mount Union, Future Business Leaders of America students to attend a leadership conference in Hershey, and 12th grade American Politics students to visit Washington, D.C.
• Heard a request from Stamm for volunteers from the board to help develop awards and recognition for exceptional students and staff. Board members Sue Bowman and Steve Persun volunteered.
• Heard that students participating in the mini-THON raised about $26,000 for the Four Diamonds Fund.
• Held two executive sessions — one prior to the meeting for legal advice and one after for a personnel matter.