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Savings found in bond refundingBy MaryHelen Swanson Saving money is a good thing. The Rush City School Board finalized the sale of refunding bonds at the Oct. 16 meeting which will bring a total savings to the district in future value of $932,000. Two bond issues were rolled into one, the 1994 series and the 1996 (aquatic center) series. With the districtís Baa1 credit rating, an excellent rating for an outstate school district, and lower interest rates, there will be a 9.6 percent savings on principle and over 10 percent savings in debt service. All this was explained to the school board by Carolyn Ehlers of Ehlers and Associates, the districtís financial advisors. The district will see a savings of $60,000 to $70,000 a year through 2018. Eight bids had been received, the low bidder being Legg Mason Wood Walker. An error in preparation of the bid package required the school board to actually reject all bids. But the board was able to continue negotiations with low bidder Legg Mason, according to Ehlers, to restructure the issue. The total amount of the refunding bond sale was $7,495,000. The district is proud of its bond rating. According to a report from Moodyís Investors Service, ìthe Baa1 underlying rating reflects the districtís historically stable financial operations which have enabled maintenance of reserves.î The school board reviewed a policy last week that reflects the districtís desire to maintain a fund balance (reserves) of at least 10 percent. This fund balance can be used to cover such unexpected things as enrollment shifts, unfunded state and federal mandates, economic turndown, increased utility costs, inflation and salary settlements. Currently, according to Superintendent Tim Eklund, the district has a reserve fund of 21 percent. The policy, which is not a Minnesota School Board Association (MSBA) policy, as most of the other policies are, addresses what the school district will do if the fund balance goes below 10 percent. At that point, Eklund noted, the board would look at reducing expenditures, study ways to generate additional revenue or proceed with a combination of budget cuts and study of ways to generate more revenue. The policy, titled ìFund Balanceî will be officially adopted at the next board meeting. In other business last week, the board: ï Learned that investment earnings are up a little from August. ï Learned that the main work at the elementary school is in the gymnasium right now. ï Heard a report on the aquatic center with Bob Schlagel and Lee Rood noting that revenues of $110,837 were more than anticipated, but still not enough to break even. Revenues included $61,706 in admissions, $16,967 in lessons and $21,291 in concessions. Salaries for the aquatic center include $3,965 for concession workers, $4,229 for custodians, $33,192 for lessons and lifeguards, $350 for aerobic instructor and $15,282 for manager and assistant. The deficit, this year being $25,040, is, by agreement, split between the school district and the city. ï Accepted, with regrets, the resignation of Kathryn Howe, academic collaborative planner for the St. Croix River Education District and approved re-assigning the position to Kerry Bollman. ï Renewed the contracts with the paraprofessionals, food service employees and the business manager. ©ECM Post Review |