Officials outline $275–$300 million capital program, urge early budget planning

Ken Phillips, a managing director with Raymond James, told the Easton Area School District Board on March 11 that advisers had modeled funding for a potential capital program in the $275 million to $300 million range and urged the district to begin putting money in place in fiscal 2025-26.

The presentation outlined phased borrowing beginning in 2026, possible refinancing opportunities for existing debt, and an estimated millage impact tied to Pennsylvania's Act 1 index. "We're going to share with you some of the thoughts that we have for a building program in the 275 to $300,000,000 range," Phillips said, adding that the plan was a financing framework rather than a prescription for specific construction work.

The advisers said the district's historic debt position is favorable and that refinancing two existing issues could save money; the presentation estimated modest savings for a 2019 issue and more than $1 million in savings for a 2018A series if refinanced under current rates. The consultants also noted the district's credit rating prospects: "Currently, you're AA2," the presentation said, adding that under a $275 million plan the district would likely remain in the A category.

Why it matters: Board members and staff framed the briefing as an early, necessary step if the district plans to proceed with a major building project such as a new high school. Superintendent Tracy Piazza reiterated that the district committed to studying a high school project that would stay within the $200 million to $300 million range. She said the district must plan for both the building debt and regular operational needs: "What do we need to continue our daily operation? And what do we need to fund this new project and or maintain our buildings at a level of acceptability?"

Key points from the presentation and discussion

- Timing and phasing: The advisers modeled borrowing across multiple years, with cash needs beginning in 2026 and carry-forward into 2029 or 2030 depending on the program and phasing decisions. - Budget planning: The advisers recommended beginning to budget for additional debt service now and suggested that, if the district is "serious about doing any type of building projects" in this range, it should plan for roughly a 1.5 percentage-point increase relative to the index (described in the presentation as "1.5%" in the slides) to fund capital and debt service over the coming years. - Refinancing opportunities: Two existing issues were identified as candidates for refinancing; one showed limited savings, the other showed potential savings in excess of $1 million under current market rates. - Credit considerations: Presenters warned that spending down reserves to fund construction affects credit metrics: "Based on a $275,000,000 capital plan... we've really drawn down fund reserves... you're probably going to be in the A category," the presentation said.

Board and staff remarks

Board members stressed that design authorization is underway but that the district is not yet committed to building if final bids exceed expectations. One board member noted the plan calls for phased borrowing and that funds allocated but not yet needed could be transferred into capital or maintenance reserves for other district needs. Superintendent Piazza emphasized that funding would come from multiple sources: the district budget, capital reserves, borrowing and the tax base.

What the board will do next

Presenters urged the board to incorporate the modeled debt-service amounts into upcoming budget discussions so the district can build the necessary reserves and debt-account funding. No formal vote on a financing plan or bond issuance was recorded in the meeting.

Ending

District advisers said they would continue to work with administration and return with further recommendations; board members indicated they want the financing profiles reflected in the superintendent's and business office's budget planning over the coming weeks.