Shawano School District officials aren’t wasting any time in moving forward after voters agreed in November to a $51.23 million building project.
School board members agreed Dec. 9 to the issuance of $14 million in bonds to get the ball rolling.
Appearing by video conference, Erik Kass, a director, public finance, with PMA Securities LLC, said that morning’s bond sale drew five bidders, with Robert W. Baird and Co. providing the best interest rate of 3.84% for the 20-year issue.
The district will get the money Dec. 30, with the first principal and interest payment of $3.4 million scheduled for March. After that, the money will be invested and will most likely be the last money spent on the project.
Kass said this is allowable because the borrowing is less than $15 million, which will not be the case with the two future bond issuances.
“The second two issues are still a little bit up in the air,” Kass said. “Bryan (Kadlec, director of finance, business and operations with the school district) and I have begun discussions where we’re going to start aligning some of those to the draw schedule that we just recently received.”
Kass said the additional interest earned on the first set of bonds can be used for one of two purposes. It can be for eligible expenses that are part of the project (for example, furniture upgrades or higher construction costs due to inflation) or it can be used for principal and interest payments to decrease the levy for those purposes in any given year.
Kass also noted the AA3 bond rating for this issue and said there probably isn’t much to be done to improve that.
“The first (way for an upgrade) is economic expansion that would raise resident income,” he said. “Certainly something that’s not necessarily in control for the school board but definitely on the radar for the credit agency.”
The available fund balance ratio was also a factor.
“An available fund balance ratio of 45% (could increase the rating),” he said. “That’s extremely high, but if you continue to maintain the existing reserves and continue to have positive additions to the fund balance – if you get to that level – that could lead to an upgrade.”
Enrollment stabilization can also help.
Downgrades would also be possible if the available fund balance ratio dips to less than 20% or if the district borrows more money than already anticipated.
In a related matter, Superintendent Kurt Krizan, said the administration held the first of 50 planned meetings with different staff groups regarding the building plans. That meeting was held earlier that day.
In addition to marketing and communications regarding the project, official are also working on the school calendars for 2025-26 and 2026-27 that are expected to be adjusted in conjunction with projects that will be underway in the summer of 2026.
“The agenda that we had tonight was to bring representatives from all four of the buildings together to talk about how this is all going to work moving forward, what work has been done so far and what’s going to be the next steps.”
Next is to meet with staff from each building separately to go through the scope of the projects.
Meetings with high school departments will follow, as some maintenance projects will be let out for bids in February.
kpasson@newmedia-wi.com
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