Jim Thorpe looks at refinancing bonds, cost savings

Jim Thorpe Area School District’s board of education approved a motion to authorize the refunding of outstanding general obligation bonds at Monday’s meeting.

Attorney Jens H. Damgaard of Rhoads and Sinon, bond council to the board, reviewed the resolution with the board, focusing on a series of bonds from 2012.

“As you know, the district in the past has always looked for opportunities to refinance its outstanding debt to save money. It’s done from time to time. Bond issues can typically be prepaid in 5-year increments,” Damgaard said to the board members. “So, at this point, your underwriter, Janney Montgomery Scott, has been tracking your 2012 bonds, which can now be retired in 2017.”

Damgaard said that due to low interest rates and the shortening of the bond issue, savings could be generated. He also said that the board tends to look at refinancing options when a certain level of savings can be achieved, usually around a minimum of 2 percent of the principal amount of the bonds being refinanced.

“Somewhere in the neighborhood of $150,000, net of all costs, would be the amount that would enable the process to move forward,” Damgaard said.

The vote in favor of the motion has started the process, which will continue with a disclosure of information, a sale of the bonds where the bonds will be run by potential bondholders, and then locking in the interest rate.

“No further formal action for the board is required, but it would be tracked by the administration to see to it that the ultimate numbers, interest rates, etc. that come from the underwriter achieve that level of savings,” Damgaard said.

According to Damgaard, the estimated savings could vary due to market fluctuations, but could also result in further savings for the district.

Personnel matters

The board voted on the following personnel matters during Monday’s meeting.

• Candace Dailey’s retirement, effective Nov. 28, 2017, was accepted.

• Laura Smarr was approved as a long-term substitute art teacher, BS Step 1, with a salary of $44,170, retroactive to Oct. 6, 2017.

• Secondary special education teacher Danielle Rozelle’s resignation was accepted.

• The board approved postings for a secondary special education teacher, a gifted teacher, grades K-12, and a long-term substitute special education teacher.

• Lucien Nocelli and Melissa Solt were both approved for positions as paraprofessionals at a rate of $12 per hour.