April 19, 2007
SCR-I District Completes $1.9 Million Lease Financing to Fund Campus Improvements
The Board of Education of the Scotland County R-I School District at a regular meeting on April 12, 2007 approved the issuance and sale of $1,905,000 Lease Certificates of Participation to provide funding for energy conservation and efficiency improvements to its campus. The improvements will be made by guaranteed performance contract with Control Technology and Solutions to existing facilities of the district.
The certificates were offered to local institutional investors and Exchange Bank of Northeast Missouri purchased the certificates, which was helpful to the success of the financing.
The lease financing structure was developed by the districtís municipal bond underwriter, L. J. Hart & Company of St. Louis. The total project cost of $1,905,000 was split between the series 2007A certificates and the series 2007B certificates in order to accommodate a potential loan program where the district would receive funding at a zero percent interest rate. If the district is successful in its efforts, portions of the series 2007B certificates could be prepaid (called) on March 1, 2008 with the loan proceeds at no penalty.
The series 2007A certificates are scheduled to mature from March 1, 2008 through March 1, 2022 with interest rates ranging from 4.00% to 4.50% and the series 2007B certificates are scheduled to mature from March 1, 2009 through March 1, 2018 at an interest rate of 4.50%.
According to Tom Pisarkiewicz, Vice President of L.J. Hart & Company, the series 2007A Certificates can be prepaid (called) at no penalty on and after March 1, 2012.
At the closing of April 24, 2007, L.J. Hart & Company will wire the funds on the Districtís behalf to the Trustee Bank, UMB Bank, N.A., of Kansas City, Missouri.
The project is expected to be completed by October.