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Mishawaka board approves lease amendment and appropriation to allow up to $45 million in bonds for new elementary school
Summary
At a March 5 meeting at Liberty Elementary, the School City of Mishawaka board approved a first amendment to a lease and a companion appropriations resolution that together would allow the Mishawaka 2001 School Building Corporation to issue up to $45 million in bonds to fund a new elementary school project.
The School City of Mishawaka Board of School Trustees on March 5 approved a first amendment to a lease and an appropriations resolution that together would permit the Mishawaka 2001 School Building Corporation to issue bonds not to exceed $45,000,000 to finance a new elementary school project.
The board held a public hearing on the combined items, which opened and closed during the March 5 meeting at Liberty Elementary, and then voted to adopt the two resolutions. Tom Everett, counsel with Barnes & Thornburg, told the board that “the school statute requires that a public hearing be held before entering into a lease or into an amendment to an existing lease.” He said the amendment would extend the lease term through Feb. 1, 1947, and that the school corporation would levy a tax to pay lease rentals; the building corporation would use those lease rentals to pay debt service on the bonds.
The appropriations resolution adopted the same maximum amount — $45,000,000 — and authorizes the school corporation to file a report of the additional appropriation with the Department of Local Government Finance. Everett described the appropriation as the step that “appropriates the proceeds of the bonds to be issued by the building corporation to fund the new … elementary school project.”
Board President Parks called for the voice votes; members approved both resolutions. Superintendent Dr. Steven Stevens and outside counsel told the board the bonds would likely be issued later this spring if the building corporation proceeds.
What the action means: If the building corporation issues bonds within the $45 million cap, the district will levy taxes to pay lease rentals that in turn pay debt service. The lease amendment changes the district’s long-term lease obligations and increases the district’s annual lease rental amount not to exceed $6,500,000 as explained by counsel.
Next steps: The board authorized execution of the first amendment to lease and the appropriation and will file the additional appropriation report with state officials; counsel indicated bond issuance would follow later in the spring subject to market and administrative steps.
