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Piedmont board approves plan to pursue underwritten bond option for $70M construction financing
Summary
Trustees authorized the district to pursue Option 1 — an underwritten revenue bond with an anticipated S&P rating and an estimated average rate near 3.45% — to deliver upfront construction funding tied to the bond program; administration said rate lock expected in two to three weeks.
The Piedmont Board of Education voted to approve a financing plan that will allow the district to secure upfront construction funding for bond projects. Administration and the district’s financial advisor presented eight underwritten bond options and a private bank placement; the board approved pursuing Option 1, an underwritten revenue bond structure that administration characterized as the most efficient and allowing for local investor participation.
The financial advisor summarized the comparison metrics used to evaluate options, including an "efficiency rating" that divides delivery amount by total debt service and prepayment provisions. Option 1 was recommended for its combination of efficiency, a seven-year prepayment (call) window, and alignment with the district’s plan to obtain formal credit ratings from Standard & Poor’s. Presenters said current market conditions made the underwritten revenue bond attractive and that a final rate would be fixed in roughly two to three weeks.
Board members asked about the rating process and criteria; the advisor said S&P will review recent fiscal history, building fund and general fund carryover and demographic trends. Administration said Cruz and Associates had produced multiple structure options and Arvest Bank provided a ninth alternative. The board’s approval authorizes staff to proceed with the recommended underwritten bond route and continue due diligence, legal review and presentations to potential participants; administrations noted the district can pause or return to the board if market conditions change before rate-lock.
