The Tallapoosa County Board of Education is looking to save money on bonds used to finance the building of the Horseshoe Bend School 30 years ago.
Bob Young with Frazer Lanier Company of Montgomery presented a proposal to the board at Tuesday’s work session in which the school system could save more than $1 million.
“It is not breaking news; interest rates have been going down,” Young said. “They have been steadily going down for almost a year. This gives you a chance to get a partial refund.”
Frazer Lanier Company is an investment banking firm that services public and private clients as an underwriter and placement agent of tax-exempt and taxable bonds.
Windle said the bonds have been refinanced twice before but this proposal would save the system big money.
“It gives the board a chance to refinance the bonds,” Tallapoosa County Schools superintendent Joe Windle said. “It will not increase the amount of time and we would not pull cash out.”
The board is currently paying about 4.75% and the bonds will mature in 2044 according to Young. Young said he expects the interest rate on refinancing could go as low as 3%.
“In total you could save $1,175,000 over the life of the bond,” Young said. “There would be no restrictions on how the savings could be spent.”
Young said with board approval of the refinancing it could take as little as 60 days to close the deal. He said it would take about 20 days to work with a law firm specializing in the bond market to prepare documents to go to a rating agency like Moody’s. Following about a five-day review, Windle and central office staff would make a presentation to Moody’s and another 10 days to get the rating. Another 10 days would be needed to prepare documents and send them to potential investors and local banks that might purchase the bonds with a deal closing about 60 days after starting the process.
Young said Moody’s is favorable on bonds from education in Alabama due to the oversight from the Alabama State Department of Education. The state checks on budgets of public school systems to make sure they have budgets and such.
County school board attorney Mark Allen Treadwell said he recently sent the Tallapoosa County Commission a new resolution to amend language in the 1-cent sales tax resolution passed by the commission at its August meeting.
“Hopefully the commissioners will recognize it still has transparency, accountability and clarity,” Treadwell said. “We feel it addresses all of that. The proposed resolution would satisfy needs for mid term financing rolled into long financing.”
Windle said the delay could impact the Dadeville lunchroom project as the phasing could be impacted. He said the last phase would require moving the fourth and fifth grades to Councill Middle School for the project to be completed.
Board member Betty Carol Graham expressed concerns about the capital plan presented to the state and no access road in the plans for the proposed auditorium at Horseshoe Bend School.
Windle assured Graham both the access road and the auditorium are on the books.
Windle also said Walt McKee of McKee and Associates is in the process of drawing up plans for the projects at all the county schools.
Board member Carla Talton asked why board members were not informed of an ongoing project at a county school as required by board policy even if no board money was spent.
“I have gotten questions and calls about a wall at Reeltown,” Talton said. “The wall has been built and we didn’t know about it.”
Windle said he and board member Martin Johnson didn’t know about the project either.
“The wall was being built and we didn’t know about it,” Windle said. “It is a decorative wall. Funds were donated to the school for it. No board money was spent on it.”
Windle said there is no board policy for changing a chain link fence but the Alabama Building Commission got involved in the project because of the decorative wall. Windle said an engineer has inspected the wall and is presenting a plan to satisfy the building commission.
“What we didn’t know is if you’re going to put something up – even a flag pole – you need a permit,” Windle said. “I thought if no kids were going to be in it, it would be all right.”
“I didn’t know it was a big thing,” Johnson said.
Windle said it is not the first time the school system has had issues with the building commission over projects.
“We got turned in over the batting cage at McKelvey Park,” Windle said. “We don’t even own the property.”
Windle said he is recommending giving a job title change for director of student services Casey Davis. He said he is recommending changing Davis’ title to assistant superintendent but without a pay increase to make it easier for Davis to possibly seek the role of appointed superintendent.
“He has the resume to be an appointed superintendent,” Windle said. “He has been an assistant principal, principal and in the central office. This would make him appealing. It would be a role for him until I retire Dec. 31, 2020.”
According to Windle, Davis currently leads high school curriculum, testing, public relations and community affairs and is the system’s safety officer. Windle said it will be up to the next superintendent whether to continue the role.