CASD Approves $18.65M Bond Issue
CLEARFIELD – On Monday night, the Clearfield Area School District Board of Directors approved an $18.65 million bond issue for its capital building program, including construction projects at the Clearfield High School and Clearfield Elementary School.
The district held a competitive Internet auction at 11 a.m. Monday, which consisted of four bidders and 13 bids. The winning bidder of the bond sale was Robert W. Baird Investment Company with a true interest cost of a little more than 3.38 percent.
Jamie Doyle of Public Financial Management said the long-term, fixed interest rates continued to hover near all-time lows, which was “excellent news” for the district. She said they recognized interest rates similar to those that the district had locked in during its bond sale in August of 2012, which were just under 3.36 percent.
According to her, Moody’s Investors Services has assigned an A1 credit rating to the district for the bond issue. She said it’s a credit to the district’s board and administrators who have made “prudent decisions” and kept the A1 rating during “challenging economic times.”
She said this time around, the bidders felt secure by the district’s “credit worthiness” and didn’t require bond insurance. She said this saved the district $58,000 right off the bat just because the district was credit worthy on its own merit.
Doyle said the Bankers Trust Company is the paying agent for this bond issue. She said that the bond issue has an optional redemption date of Sept. 1, 2021, an 8.5-year call. She said they had initially planned to bid $10 million or less to get the 5-year call. Doyle said this issue ended up being greater than $10 million, so it resulted in a little longer than a 5-year call.
According to Doyle, the district’s total local effort, including its old debt and its new bond issue, stayed at around $1.725 million on average after state aid each year, beginning in the 2013-14 school year through the 2038-39 school year. She said the district’s settlement date with Robert W. Baird is March 28 with a yield on the bond of 3.19 percent.
To date she said the district has issued bond sales in the amount of $9.8 million and $9.9 million in 2011 and 2012, respectively for the high school project. She said this bond issue for $18.65 will go toward the high school and to initiate the CES project. She said the district anticipates it will issue another bond sale for $8.15 million in 2014 in order to complete the CES project.
Doyle said the three bond issues and the anticipated one have a millage equivalent of 4.40 percent. In December of 2012, she said they had anticipated 5.9 mills.
“It was fabulous results today, and it really worked in your favor,” she said. Doyle recommended that the district accept the Robert W. Baird proposal.