The Siloam Springs School Board approved a request from Superintendent Jody Wiggins to refinance one of two bonds at the school board meeting on Thursday.
The bond has a principal outstanding balance of $8,125,00 and was issued on March 1, 2019, according to the application to refinance the bonds. By refinancing the bonds, the Siloam Springs School District will be eligible for a lower interest rate, Wiggins said.
The current interest rate is 2.96 percent and the new rate SSSD is eligible to lock into is 1.55 percent, Wiggins said.
Wiggins told the board he received a phone call from Scott Beardsley, the president of First Security Beardsley, the financial institution that entered into an agreement with the school system, to let him know the bonds came up to call and could be refunded again.
Investors are given a certain period of time where the issuers of the bond promise not to try to refund the bonds, Wiggins said. When bonds come up to call, investors are notified the bonds are eligible to be refinanced, Wiggins said.
Beardsley estimated a savings somewhere between $800,000 and $1 million dollars, Wiggins said.
"It's not going to be a check written to us, it's going to be savings on our payable savings bonds," Wiggins said. "So it's like refinancing your house and getting your payment reduced."
Wiggins asked Beardsley why this bond is eligible for refunding and not the second bond of $40,585. The superintendent was told that if a bond is smaller than $10 million, the bank can do a two-year call on it, while bonds over the $10 million mark have a five-year call.
The other bond was issued on March 1, 2020, the application states.
Once the school district applies for the refunding, First Security Beardsley will have to place an advertisement in a statewide paper so investors will know about the opportunity. Since the bond is less than $10 million, the bidders will most likely be Arkansas companies.
If the school district changes its mind and does not refund the bonds, it will owe First Security Beardsley advertising costs for the project, Wiggins said.
Under the scenario the school district was presented, it will have a total savings of $916,477, Wiggins said. The superintendent anticipates companies may start bidding on the bonds as early as the first week in August.
The school board also discussed the following items during the meeting:
• Approved the meeting minutes for the school board meeting on June 10.
• Heard reports from Wiggins, and Assistant Superintendent Amy Carter and Shane Patrick.
• Approved the June financial statement.
• Approved proposed policy updates for the 2021-2022 school year.
• Approved an agreement with BiLD Architects PLLC.
• Approved bid to seal and stripe the parking lot at the intermediate school.
• Approved a bid with Commercial Audio Systems to upgrade the audio system.
• Approved the 2021-2022 school-level improvement plans.
• Approved the resignations of the following licensed personnel: Maygen Clark, Allen Elementary special education teacher; Leigh Chickering, Allen Elementary first grade teacher; Tayler Mounce-Caldera, Allen Elementary first grade; Heather Hardcastle, middle school social studies.
• Approved the hiring of the following licensed staff for the 2021-2022 school year: Kim Tillman, middle school literacy academic interventionist; Maureen Broglen, middle school math; Arlie Templeton, intermediate art; Alexandra Savage, intermediate fifth grade English language arts; Audrey Mathe, Northside kindergarten teacher; Ashley Lee, Allen first grade; Christopher Gorgas Coonrod, intermediate fifth and sixth SPED; Anita Pursley, high school math; Brittany Huffaker, high school SPED; Linda Williams, high school career and technical education; Debra Elkins, Northside special education teacher.
• Approved two student transfers out of SSSD.
• Approved bid for Southside East flooring project.
• Approved the summer hire list.