Interest rate lower than projected
By Angie Landsverk
The Weyauwega-Fremont School District plans to begin its building and improvement program in early June.
The first phase addresses the mechanicals at the high school.
Approximately eight different vendors scoped out that bid package last week in anticipation of this month’s bid opening for it, District Administrator Scott Bleck told the school board on April 10.
“We’re excited to see what happens with Phase 1,” he said.
Last November, voters in the school district approved spending up to $21 million on the building and improvement program.
On March 17, the district closed on its first bond issue of $10 million.
Drew Niehans, the district’s business manager, said the interest rate for those Bond Anticipation Notes came in at 3.49 percent.
That rate is about half a percent lower than the rate the district projected, he said.
It means the average mill rate impact will now equate to $2.48 per $1,000 of valuation over the length of the bond, said Niehans.
The school district projected the average mill rate impact would be $2.65 over the course of 20 years.
Niehans said that $10 million bond will be for the last portion of the 20-year period.
Last month, the school board authorized the issuance and sale of the second $10 million.
“The ones we’re working on now will be for the first 10 to 15 years,” Niehans said.
He said the district was surprised, in some respects, by what the interest rate came in at for the first $10 million bonds.
The district went through a credit rating and received an investment grade of AA- from the ratings agency Standards & Poor.
“For a district this size, that is as about as high as you can go,” Niehans said.
The highest rating is AAA.
Standards & Poor looked at the district’s financial information and its past budgets.
“One thing that benefited the district,” he said, “is that it has fully funded post-employment benefits.”
The district is also debt free.
“Those two things really helped make up that AA- rating for the district,” Niehans said. “The district came in on the high end of what it was expecting.”
He said the district does not have to go through another credit rating for the issuance of the second $10 million in bonds.
The district hopes to go to market with those bonds either this month or in May.
In regard to when the final $1 million in funding is issued, Niehans said, “We will get to see how the project pans out before we decide how we want to do that $1 million. We will look at different scenarios.”
The school district is targeting a mid-July release for the second bid package for the project.
“That will be all the other components of the high school campus upgrade,” Bleck said.
The $20.6 million in improvements and additions at the high school will include four new classrooms, a new secure entry, a 400-seat auditorium and a multipurpose gym.
The high school project will also include remodeling the commons and creating a forum room and flexible learning areas.
Work on that phase is projected to begin by September.
“We’re excited to enter a changing environment within our high school. We appreciate the community’s support and understanding throughout the process, knowing the end result will change education in Weyauwega-Fremont for years to come,” Bleck said.