Ohio County Schools To Receive Extra $2 Million On Bond for Projects
WHEELING — The Ohio County Board of Education is set to have an extra $2 million at its disposal for planned construction projects, thanks to low interest rates on its $42.2 million bond.
The board voted Thursday to finalize the sale of the bond, approved by voters last May, to finance firm Robert W. Baird & Co. at an interest rate of 2.47 percent.
The interest rate, deemed lower than expected by Joseph Nassif, managing director for public finance banking with Piper Jaffray, means that the school board will see total proceeds of $44.1 million through a premium, he said.
“You’ll have a couple extra million dollars of additional proceeds that you’ll be able to spend on your projects,” Nassif said. “So it’s very exciting.”
Nassif explained that the bond received six bids, all at low, “healthy” interest rates.
“To get six bids of this magnitude and these low rates means it was very well received in the market,” he said.
In May 2018, Ohio County voters approved the $42.2 million bond issue, which will last over 15 years. The money is part of about $76 million planned for improvements to school facilities.
In addition, the low interest rate means that the board will have a lower debt service, or payments made for the bond, Nassif said. Potential debt service will be nearly $11 million lower than expected, with a $53.6 million principal payback, he said.
“Thank you Joe for your guidance on this project,” Board President Zach Abraham said. “It’s been a good team effort so thank you for your guidance on that. We definitely couldn’t have done it without you.”
Board member and attorney David Croft said the $2 million premium will create additional funding for the district.
“That really low rate creates a premium for us,” he said. “It’s just additional funding and the reality of that is, to me, it should help us balance escalated costs because labor is going to go up.”
Croft said he anticipates that increased oil and gas activity in the Ohio Valley will lead to higher labor costs.
The planned improvements involve renovations and repair work on 13 school buildings within the district, including heating and air conditioning work and roof replacements.
The board voted unanimously to approve a supplemental resolution finalizing the terms of the bond, awarding it to Robert W. Baird and setting the 2.47 percent interest rate.
Board members further approved policies and procedures for helping the board and staff comply with disclosure regulations related to the bonds.
In addition, the board approved a certificate respecting a separate Securities and Exchange Commission rule relevant to the bond.