District accepts BNY Mellon bid for $5.3M note to finance HVAC referendum; funds expected Dec. 23
Loading...
Summary
After voters approved an HVAC referendum Nov. 4, the district completed a competitive note sale Dec. 11; BNY Mellon was the low bidder at 2.71% and the temporary note of $5,345,031 is expected to settle Dec. 23, with construction bidding to follow.
Marlboro Township School District officials told the board Dec. 11 that the financing process for the already-voter-approved HVAC referendum is advancing on schedule.
Administrators said the district received a favorable credit opinion from Moody’s (A2) and conducted a competitive sale on Dec. 11. BNY Mellon Capital Markets was the low bidder, offering a rate of 2.71% on the temporary note; the note principal cited in the meeting was $5,345,031 with a maturity date of July 15, 2026. Funds were expected to be delivered to the district on or about Dec. 23.
Once funds are received the district will proceed with architect- and engineer-led bidding for the Robertsville and Abbott HVAC projects; administration said work is planned to take place in the summer with occupancy and project closeout anticipated by late fall or the following spring depending on equipment lead times.
Finance staff reviewed the choice to use a short-term note, estimating total interest around $115,000 and noting a portion of interest is covered by debt-service aid. The administration said the district’s portion of interest after aid is roughly in the $50,000 range for the short-term approach, a trade-off that allowed quicker project start while minimizing long-term debt costs.
Budget implications: administration explained the district intends to use capital reserves for its share of the referendum and expects debt-service aid to cover roughly 34% of the interest. Officials also noted the district’s historical declines in state formula aid, and discussed planning the budget for 2026–27 under a cautious assumption of flat state funding.
What’s next: After settlement and acceptance of funds, the board will see contract approvals for architecture/post-referendum services and will consider awarding construction contracts after the bid process.
Sources: Finance presentation and public statements by district finance staff recorded during the Dec. 11 meeting.
