Radnor committee reviews plan to issue bank‑qualified bonds for Ithan Elementary

Radnor Township School District finance staff and outside advisers presented a plan this week to issue a bank‑qualified municipal bond as the third phase of financing for the Ithan Elementary project. The proposed issuance is expected to be “a little under $10,000,000,” staff said, and would be structured to preserve bank‑qualified status while a parameters resolution that authorizes up to $12,000,000 in principal will be offered for board approval.

Zach Williard of PFM told the committee the district had previously issued about $9.4 million in 2023 and roughly $9.8 million in December 2024 to start the project. He described current market conditions as favorable, noting recent rate declines and that markets were pricing in an expected Fed move, which creates a window for borrowing. “This would be the third phase of the borrowing,” Williard said, summarizing the multi‑phase plan and the team’s intention to time a sale when conditions are advantageous.

Under the plan, the district would use a phased schedule that includes an initial bank‑qualified issuance below the federal $10 million per‑calendar‑year threshold to secure more favorable refinancing options later. Williard and underwriters explained the resolutions sent to the state typically show a higher maximum principal (about 20% larger) to satisfy the Pennsylvania Local Government Unit Debt Act’s maximum‑authority requirements; the larger number (commonly shown as $12,000,000) provides maturity‑by‑maturity flexibility without changing the district’s intended issued principal.

Mark Quinn of Stifel, one of the underwriters, described Schedule A in the debt resolution as the mechanism that lets underwriters shift principal among maturities on the pricing date: “We’re selling bonds that do not exceed $10,000,000… but the 20% cushion lets us move things around maturity by maturity,” he said.

Committee members asked about refinancing opportunities; Williard said the bank‑qualified structure typically provides an earlier call/refund window (first call estimated in 2028) and the district could realize savings if rates fall and refunding is advantageous. He cautioned that precise savings depend on future market conditions.

Staff said a debt resolution would be available at the Oct. 28 board meeting and that bond counsel would attend to answer questions; they expect to lock rates and price the bonds the following week while reserving the option to pause if markets deteriorate.

The finance committee did not take a final vote at the meeting; next steps are the parameters resolution at the Oct. 28 board meeting and a pricing decision if market conditions remain favorable.