[ad_1]
CEDAR FALLS — Cedar Falls Community Schools will pay an interest rate of nearly 4% on $69.9 million in bonds being issued to help fund construction of the new high school.
The Board of Education approved selling the bonds to Citigroup Global Markets in a special meeting Wednesday. Total purchase price was $70.04 million, including a premium payment to the district of $136,000. The Los Angeles firm offered the lowest interest of three bidders on the debt, a true interest rate of about 3.98%.
Still, those interest payments will add up to $32.79 million over the 20-year life of the general obligation bonds.
“The total interest, you can see, is pretty significant,” said Maggie Burger, of Speer Financial, which advised the district on the sale. She noted, though, that there is a call date of June 1, 2031, when the remaining bonds can be refinanced and paid off early. Otherwise, Cedar Falls Schools will finish paying off the bonds in 2042.
Burger and Superintendent Andy Pattee said that through the planning process on the new high school an interest rate of 4% or higher was anticipated for the bond sale. But officials were watching those factors as they considered the timing to issue bonds.
People are also reading…
Pattee
“Probably eight months ago, we were still thinking we were going to sell in August,” said Pattee. Administrators decided to speed up that timeline to “get ahead” of interest rates that may continue increasing.
Two national bond rating firms had a mixed response to Cedar Falls Schools taking on the additional debt. Standard & Poor’s continued to give the district an A+ rating while Moody’s Investors Service downgraded it.
“Moody’s did downgrade the district from its Aa2 to its Aa3 rating,” said Burger. The agency cited the doubling of debt and fluctuations in reserve funds. She noted that a buildup in reserve funds is helping to lower the impact on taxpayers.
“They think you are definitely a strong double ‘A,'” Burger said, adding that the rating will increase “as you pay this debt off.”
The bonds, one of the revenue sources for the $112.71 million building project, will be repaid with property tax funds. The school site is located on 69.6 acres north of West 27th Street and west of PE Center Drive.
The board’s action locked in the interest rate, but further approvals will be needed at the May 23 meeting to finalize the sale. The process closes June 7, when the funds will be in district accounts.
Cedar Falls High School aerial drawing
An architect’s drawing shows a view of the planned Cedar Falls High School with a pool addition that boosters are currently fundraising for.
site-plan-this
The Cedar Falls High School site plan was presented to the Cedar Falls Planning and Zoning Commission on Wednesday.
New CFHS exterior entryway
An architect’s drawing showing the front of the planned new Cedar Falls High School.
New CFHS entryway and lobby
An architect’s drawing showing the entryway and lobby of the planned new Cedar Falls High School.
New CFHS learning studio
An architect’s drawing of a classroom, or “learning studio,” in the new Cedar Falls High School.
New CFHS commons exterior
An architect’s drawing of the back exterior wall of the commons area at the planned new Cedar Falls High School.
New CFHS co-learning studio
An architect’s drawing of a “co-learning studio” in the planned new Cedar Falls High School. These flexible breakout spaces will be outside of…
030720ho-cf-school-working-space
A photo rendering from Invision Architecture in Waterloo shows a collaborative working space planned in the new Cedar Falls High School set to…
New CFHS commons interior
An architect’s drawing of the commons area at the planned new Cedar Falls High School.
New CFHS gymnasium
An architect’s drawing of the gymnasium in the planned new Cedar Falls High School.
New CFHS learning wing
An architect’s drawing of the entryway to the “learning wing,” or classroom area, of the planned new Cedar Falls High School.
New CFHS main corridor
An architect’s drawing of the main corridor at the planned new Cedar Falls High School.
New CFHS office
An architect’s drawing of the office at the planned new Cedar Falls High School.
Cedar Falls High School pool drawing
An architect’s drawing shows a view of a future pool planned for the new Cedar Falls High School.
030720ho-cf-school-front-entrance
This rendering from Invision Architecture shows the planned front entrance of the new Cedar Falls High School building.
030720ho-cf-schools-lunchroon
This rendering from Invision Architecture shows the planned lunchroom, now called a commons area, in the new Cedar Falls High School.
Artist rendering of solar panels on new Cedar Falls High School
An artist rendering of possible placement of solar panels on the roof of the new Cedar Falls High School were presented at the Cedar Falls Uti…
[ad_2]
Source link
