Stafford MSD board approves $7 million tax‑revenue anticipation note at 3.48%
Summary
The Stafford Municipal School Board approved a $7 million tax and revenue anticipation note (TRAN) to cover operating cash shortfalls until property tax receipts arrive, accepting a low bid at 3.48% and authorizing closing on Oct. 1.
The Stafford Municipal School Board on Sept. 22 approved a resolution authorizing the issuance of a $7 million tax and revenue anticipation note, known as the TRAN Series 2025, to cover operating cash needs until property tax collections arrive. The board voted unanimously, 6-0.
Board officials said the district solicited competitive bids and accepted an offer from Texas Capital Bank at an interest rate of 3.48 percent. The district expects to close the borrowing on Oct. 1 and complete required signature pages at closing.
The TRAN is intended to cover the district’s cash shortfall that occurs each fall, when vendor bills (for example, insurance) are due before most property tax revenues are received. CFO Josh Bostick told trustees the district previously issued a $9 million TRAN last year and a $6 million note the year before; this year’s $7 million size reflects projected cash flows and a conservative cushion above the estimated need.
A district staff member, Clarence, added that the 3.48 percent rate was substantially lower than several other bids received — PNC at 3.69 percent, Regions at about 3.92 percent and Frost Bank at 4.12 percent — and that the lower rate was likely tied to market moves around the Federal Reserve. The board’s discussion also noted that the district typically closes this note in March and paid off last year’s note in March.
Trustee Hana Hossa praised the administration’s work and asked whether the $9 million from last year was fully used; staff replied that the district paid off last year’s note and that $7 million reflects current cash‑flow projections. Several trustees and staff described an internal goal of building a larger fund balance — roughly $10 million, they said — so the district could reduce or eliminate annual TRAN borrowing in future years. Board members noted that reaching that fund balance will likely take multiple years.
Motion: Approve resolution authorizing issuance of Stafford Municipal School Board tax and revenue anticipation note, series 2025. Mover: Trustee Hana Hossa. Second: Secretary Cesar Montelongo. Vote: Motion carries, 6-0.
The district will proceed with closing and signature collection on or about Oct. 1 and return to the board with any final closing documents as required.
