City Schools System saving $6 million on construction bond rates
The Madison City Schools System received great news Tuesday, Oct. 12, as the school board and the Madison City Council held a joint meeting to announce the interest rates in the qualified school construction bonds.
During a brief meeting at the Schools Central Office, it was announced the system will have to have back $29, 902,006 of $36 million loan over 17 years due to a federal subsidy on the interest and the bonds earned on the principal amount.
Johnny Dill, a financial consultant in municipal finance for Joe Jolly & Co., has worked with the school system during the process, and he said this second bond issue was a result of the school system being the first to apply in the state.
“It was like a perfect storm,” Dill said. “It’s a wonderful night for the school board and the city.”
The Madison City Council passed a half-cent sales tax last year to back up the first bond issuance, but the a lack of bond buyers forced Congress to reevaluate the process, which has now allowed the school system to just pay back 83 cents for every $1.
As a result of the new bond and a refinanced load last year that freed up $22 million, the school is moving forward on building a new high school.
“This all started in 2008,” Madison Mayor Paul Finley said. “One of the first things we did as a collective body was to sit down and analyze the needs of city. The largest piece and the largest improvement is we need a second high school.”
By working together, Finley said, the council and the school board are helping build a better Madison.
“We started this as a team,” Finley said. “Most folk have moved to Madison because they want to put their children in the best school system available.”
School bard President Ray White said the whole deal is a win-win for the schools and the city.
“If you look around at the world-class school systems, you can’t have a world-class school system without significant local, financial and government support,” White said.
Following the joint meeting, the school board held its regularly scheduled meeting. During that meeting, the school board:
—Approved change orders resulting in savings of approximately $90,000 for three projects: the Bob Jones High School culvert, the Mill Creek Elementary School playground and the BJHS practice/soccer field renovations.
—Approved a land swap with the city to construct a bus station. The school system will swap 8.63 acres around the Central Office and the Madison City Schools Stadium for 10 acres off Westchester Road. The initial plans for the station have been completed and sent to Montgomery for approval. Once the plans are returned, bids will go out. Once the bids are accepted, Superintendent Dr. Dee Fowler said construction should take approximately six months.
—Approved goals for Fowler, which include up to $10,000 in incentives.
