North Pike school board approves 12-year, 4.06% loan; pledges part of state EEF to help pay note

The North Pike School District Board of Education voted unanimously to accept a 12-year loan from Regions Finance Corporation at an interest rate of 4.06% for the district’s 3-mil note, with an option to prepay after six years.

The loan decision came after the superintendent and finance staff reviewed competing bids and recommended Regions as the best financial option. The board recorded a 5-0 roll-call vote in favor of the Regions loan.

Board members and staff emphasized the district chose a 12-year structure over a 15-year option to shorten the borrowing period and reduce total interest costs. Finance staff said the 12-year loan will require the district to pledge and use a portion of the state Educational Enhancement Fund (EEF) to help meet the note payment, reducing the availability of those EEF dollars for other purchases such as buses.

Why it matters: The district will use a mix of courthouse borrowing under its 3-mil note and local/state EEF funds to meet debt payments. Finance staff described the district’s plan to devote about $25,000 per year from the roughly $75,000 annual EEF allocation toward the loan payment; other amounts and the total note principal were specified in discussion as coming from the courthouse borrowing and loan proceeds…