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Keller ISD board authorizes parameters to pursue refunding bonds, potential $30M savings projected
Summary
The Keller ISD Board adopted a parameter order July 24 authorizing district officers to pursue one or more unlimited tax refunding bond issuances; a financial adviser projected potential long-term savings of roughly $30 million based on current interest-rate assumptions.
The Keller ISD Board of Trustees on July 24 adopted an order authorizing district officers to pursue one or more unlimited tax refunding bonds, a step that gives the superintendent and chief operating officer delegated authority to finalize pricing if parameters are met.
Why it matters: The district’s financial adviser said the refunding could generate substantial net present-value savings to taxpayers if market conditions permit; the presentation estimated roughly $30 million in savings on the maturities under review based on current rates plus a conservative buffer.
What the board authorized: Hilltop Securities reviewed the district’s outstanding debt and recommended issuing refunding bonds for callable maturities from 2015 and select 2016 series as market conditions allow. The board adopted a parameter order that sets maximum principal, maximum interest rate, minimum present-value savings and a one-year authorization window; delegated pricing officers would only proceed if those parameters are met.
Projected savings and costs: The adviser’s example projection indicated more than $30 million in long-term savings; an estimated issuance cost placeholder of about $200,000 was discussed as an initial planning figure to cover municipal advisor, bond counsel, rating agency fees and other transaction costs. Final savings and costs depend on market pricing at issuance.
Process and timing: An initial refunding target would be for maturities callable in August (allowing execution within the 90-day window required for tax-exempt treatment); the adviser said other 2016 maturities might be considered in October if market conditions are favorable. The order’s delegation is valid for 365 days, allowing the administration to act quickly if the market is right.
Board comments and vote: Trustees asked about the mechanics and delegated authority; the district said any execution would involve pre-issuance calls with rating agencies and the district’s financial officer before final approval. The board approved the parameter order unanimously (5–0).
Ending: The parameter order does not itself issue debt; it authorizes district officers to finalize a sale within set limits and to act when the market yields the stated minimum savings.
