The Lisbon School district did find a bidder with competitive rates via private placement in the bidletting process. By doing so, the board was able to receive $8.1 million in financing, with roughly $5.77 million generated for the new construction projects the board plans to pursue in coming years.
Matthew Gillaspie with Piper Sandler said that Pinnacle Principal Financing out of Scottsdale, Ariz., was the lowest bidder, offering the $8.1 million at a 3.66 percent interest rate.
“We know rates have started going higher than when we originally started talking about this project, but 3.66 percent is a good rate in this market,” Gillaspie said. “We had a district that went traditional bonding that got a similar rate, but they had to pay a percentage of their bond for the project.”
The district can start making prepayments on the bonds in the next few years.
Gillaspie said there were two other bidders on the project, including Hills Bank and Western Alliance. Both of their interest rates were higher than that offered by Pinnacle, and Gillaspie said he would have recommended the district go with direct bidding for the bonds instead of taking those rates.
The district will pay off the $2.4 million in bonds they refinanced for the Lisbon Early Childhood Center in 2020. That refinancing was slated to save the district $430,000 in interest payments over the life of the bonds, but keeping the payments going at the same time as part of the project would have impacted the funds available in the SAVE for the other projects the district needed to pay. The district only realized $140,000 of the reduced payments in interest payments for their financing.
The district will have the bond monies distributed Aug. 24, and the board plans to invest that money into an account to generate interest as construction on different projects is completed.
Gillaspie said that the district’s fund will always be roughly $260,000 in SAVE funds over the course of the Physical Plant and Equipment Levy. That will allow the district to tackle $8 million in additional projects over the next 30 years. The SAVE fund is generally used to pay for 1:1 computer initiatives and new school buses.