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West Geauga Board Hears Presentations on Bond Issue Financing Options

West Geauga Board of Education Board Special Meeting - 12/11/24

Meeting Details: The West Geauga Board of Education met on December 11, 2024 at 5:00 pm in the Board Office Community Room, 8615 Cedar Road in Chester Township. Meetings are open to the public and media. The meeting agenda and minutes are available online. Look for the Meeting tab in the right hand corner. Pick the meeting you want to review and then click on “Agenda.” A video recording is

available here.

Board Attendance: President Christina Sherwood, Kathy Leavenworth, and Dr. William Beers were present. Pam Claypool and Mary-Michelle Coleman Walsh were absent

Staff Attendance: Karen Pavlat, Treasurer; Dr. Richard Markwardt, Superintendent; Dr. Nancy Benincasa, Assistant Superintendent, and Scott Amstutz, Director of Instructional Technology

Other Attendees: There were four other unidentified attendees.

Call to Order: The meeting was called to order at 5:02 pm, roll call was conducted, and the Pledge of Allegiance was recited.

Program Reports and Presentations

• 0.20 min. Master Facilities Financing Plan Summary - Ms. Pavlat announced that the district had retained Bricker Graydon LLP as Municipal Advisor and Bradley Payne Advisors as Bond counsel.  She then provided a summary of the process and events of the Master Facilities Plan:

  • January 2024 - The Board approved the Master Facilities Plan’s October 2023 recommendations to construct a 6-12 building, renovate the current Middle school to a K-5 building, and build an auditorium.

  • Summer 2024 - The Master Facilities Plan was reassessed and an updated scope and cost was prepared.

  • September 2024 - Enrollment projections were presented to the Board.

  • October 2024 - Final best estimate of $128,200,000 for project cost was determined.

  • December 2024 - Tonight’s presentation to focus on bond financing costs and options.

• 3.46 min. Bond Financing Process, Purpose, Timeline, and Levy Guidance - Catherine Swartz, Partner, Bricker Graydon LLP, presented an overview of the bond election process and filing deadlines for the May 6, 2025 ballot initiative.  A Resolution of Necessity will be voted on at the regular meeting December 16th, and a Resolution to Proceed will then be voted on at the January 13th meeting.  The project cost requires a “special needs” designation because it exceeds 9% of its calculated debt limit.  Because of the district’s high special debt valuation, this is just a formality required by law. 
  

The bond will generate $128,200,000 in funds and have a maturity of 38 years.  Ms. Swartz said that the board needs to create a “purpose clause” for the ballot.  She suggested that this clause should be specific enough to appeal to the electorate but general enough to allow some room for revision, if needed.  She offered the following to facilitate discussion: constructing, renovating, expanding and improving school facilities; furnishing and equipping the same; (including a field house for school and community use); improving the sites thereof.”  After general discussion of the purpose, it was decided to include the “auditorium” in the purpose language.  Ms. Swartz indicated that the revised language would be sent to Ms. Pavlat in time for the next board meeting.  She paused her presentation to allow Heather Arling, Director, Bradley Payen, to present bond financing options.

• 20.50 min. Bond Financing - Ms. Arling presented detailed financing information for a bond issue.  Those participating in a traditional bond issuance include the issuer, underwriter and counsel, municipal advisor, bond counsel rating agency and the Bond Registrar and Paying Agent.  A traditional Bond and Post Election Timeline is about 10 weeks.  Bond issue costs (BIC) would be about $1.3 million.  This cost can be covered by selling the bonds at a premium. Using an interest rate of 4.75% would equal 5.24 mills at current valuation, which would cost taxpayers $15.27 per month per $100,000 of valuation.   An optional funding source is a USDA loan.  These loans are at a lower rate but are paid out during the project and not in a single payment like a traditional loan.  The USDA loan amount is capped at $100 million, so a hybrid approach would need to be used.  The current USDA loan interest rate is less than 4%, but there are indications this may increase to 4% in the near future.  The USDA has a lower BIC than a traditional bond issuance.  There is some time left for the board to discuss its options.  The Board will use a conservative 4.75% interest rate so that the County Auditor can calculate the bond millage.  After bonds are issued, if the millage generates too much in revenues, the millage rate can be adjusted to better reflect the bond repayment schedule.

• 54.45 min. Resumption of Ms. Swartz’s Presentation - Ms. Swartz closed the presentations by talking about guidelines for school district personnel and board members when campaigning for a bond levy.  She emphasized that no public funds may be used for the campaign.

1:07.45 min. Personnel Resolutions - All Approved

• 2024-12-384 Certified Substitute List for the 2024-2025 School Year

• 2024-12-385 Resolution to Approve Substitute Administrator for the 2024-2025 School Year - This action provides for a temporary substitute administrator.  Dr. Markwardt commented that the district was fortunate to be able to talk Mr. Chaffee out of retirement to fill this position.  He knows Mr. Chaffee personally and has worked with him in the past.

• 2024-12-386 Resolution to Approve Classified Staff Appointments for the 2024-2025 School Year

• 2024-12-387 Resolution to Accept Classified Staff Resignation

• 2024-12-388 Resolution to Approve Additional Transportation Route Assignments for the 2024-2025 School Year

• 2024-12-389 Resolution to Authorize the Award of Service Contracts for the 2024-2025 School Year

1:12.35 Min. Adjournment

Next Meeting: The next meeting will be on December 16, 2024 at 7:00 pm in the Board Office Community Room, 8615 Cedar Road in Chester Township.

Observer: Bob Doxey

Editor: Anne Ondrey

Reviewer: Sarah McGlone

  

Date Submitted: 1/1/2025

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