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Board authorizes up to $31 million maintenance tax note; trustees plan early payoff
Summary
The board approved a resolution authorizing issuance and borrowing related to a Manor ISD maintenance tax note; the district's advisers recommended Texas Capital Bank at a 3.75% rate and trustees indicated a goal to pay the note off early when tax receipts arrive.
The Manor ISD Board of Trustees voted unanimously to authorize district staff to borrow funds through a maintenance tax note and to adopt a related resolution at the May 19 meeting.
Financial terms and recommendation: Financial advisers representing the district said they sought competitive bids and recommended Texas Capital Bank’s proposal at an interest rate of 3.75%. The advisers reported other bids of 4.01% (Regions) and 4.39% (Huntington). The recommended structure allows the district to call and pay the note earlier without penalty.
District intent to pay early: Chief finance staff and trustees said the district’s plan is to pay the note early if tax‑receipt cash flow permits. ‘‘It is our goal to pay it off early and based off our cash flow projections…we should be able to pay off that note sooner,’’ said Moises Santiago (district finance staff), summarizing cash‑flow expectations tied to property‑tax receipts in January and February.
Resolution and vote: Bond counsel presented a resolution incorporating the financial terms; Trustee Howard moved to approve the resolution as presented, with an amended authorization amount discussed in the meeting. Trustees approved the resolution and the authorization for borrowing in a roll call vote that passed 7‑0. The motion as amended referenced a not‑to‑exceed amount near $31,000,000 and authorized the superintendent to execute required documents.
Why it matters: The note is intended as a bridge financing mechanism, the advisers said, to cover near‑term cash needs while the district awaits state aid and tax revenues. The recommended bank included a flexible call feature to allow earlier payoff and interest savings, which trustees and staff said they intend to pursue if revenues are realized.
Next steps: Financial advisers said, with board approval, funds could be received on or about June 11 and the district will finalize loan documents with bond counsel. The board asked administration to present a multi‑year budget plan at the June meeting describing how future borrowing can be avoided.
Ending: Trustees approved the borrowing resolution and requested further multi‑year budget details in an upcoming meeting.
