The School Board for the Pulaski County Special School District is planning the refunding of bonds in the coming months as a way to generate more than $2 million for district use.
On the advice of Leigh Ann Biernat of Stephens Public Finance, the board will submit an application for permission to refund $46,650,000 in bonds to the Arkansas Division of Elementary and Secondary Education.
The outstanding bonds come from a 2015 issue by the district and cannot be refunded before November of this year.
The early application to the state agency and anticipated approval from the Arkansas Board of Education will enable the district to be prepared for a bond sale as early as November.
The school board's unanimous vote authorizes Superintendent Charles McNulty to proceed with the bond sale later this year if the market conditions, including interest rates, are advantageous to the district.
The current rate on the bonds is about 3.24%.
The bond refunding would not require voter approval.
The refunding could, depending on the market, produce $2.038 million in savings between the time of sale and 2035, but almost all of that savings -- $2 million -- would come in the first year, Biernat told the School Board this week.
Linda Remele, president of the School Board, said Friday that the board has not yet identified how the money resulting from the refunding would be used.
But the possible uses should become clearer in the coming days, she said, when the board holds a work session on its long-term master facility plan, a document that also goes to the state Elementary and Secondary Education Division.
"We want to turn in a master plan that we have thoroughly looked at and completely understand and agree to," Remele said of the board and the yet-to-be-scheduled work session.
The condition of district campuses is subject to federal court monitoring in the long-running Pulaski County school desegregation lawsuit. The district is obligated by its desegregation plan, Plan 2000, to have equal school facilities.
U.S. District Judge D. Price Marshall Jr., the presiding judge in the case, has scheduled a court hearing to start July 14 during which he will evaluate the district's compliance with its desegregation obligation, including the condition of buildings. He is doing that with an eye toward possibly declaring the district unitary and eligible for release from further desegregation monitoring.
"We want a real good handle on where we are going with facilities because that is one of the issues we are taking to court," Remele said. "We all want to understand what our plan is and what the projections are before we turn in something that we are going to have to defend in July.
Along with authorizing a state application to refund the bonds and allowing the superintendent to proceed with a sale, the Pulaski Special School District board renewed a three-year contract with Stephens Public Finance to be the district's financial adviser.
Metro on 02/15/2020