Oldham County Board clears resolution to allow refinancing of 2015 school bond

On June 8, the Oldham County Board of Education unanimously approved a resolution allowing the district to pursue refinancing of its Series 2015 school bond, which financed renovations to South Holden Middle School. The vote was 5-0.

Rich Kelly, who spoke to the board as the presenter on the financing item, said the district currently has about $18,000,000 outstanding on the Series 2015 issue and would pursue refinancing only if it met the Kentucky Department of Education's 3 percent present-value savings threshold. "We would obviously need to save the 3%, which is the threshold, which would be about a $100,000 a year," Kelly said. She added that the district would not extend the bonds' final maturity as part of a refinancing and that there is no cost to the district if the refinancing is not pursued.

The board had previously obtained state approval, Kelly told members, and the current action gives the board the local approvals that would allow refinancing to move forward quickly if market rates fall and the 3% present-value savings test is met. "We've already done the state's approval, and this will be the board's approval of the refinancing," Kelly said.

Board members asked clarifying questions about expected savings and the mechanics of a refinancing. The motion to approve the resolution was made by Henley and seconded by Sheffer; the measure passed 5-0.

Because the district does not meet the KD E savings threshold at present (Kelly said present value savings were roughly 1 percent at the time of the presentation), the board's approval authorizes staff to be prepared and to proceed only if future market movement produces the required savings. The next procedural step is administrative: staff and the district's financial advisers will monitor rates and return to the board if refinancing meets the threshold or if more approvals are required.