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Lake Stevens board authorizes bond guarantee and delegation; financing team outlines $80M new-money plan and $40M refunding option
Summary
The board voted June 10 to authorize participation in the Washington State School Bond Guarantee program and to delegate bond-sale authority; the district's financing team outlined an ~$80 million new-money bond sale and the option to refinance $40 million of 2016 bonds with estimated but market-sensitive savings.
Lake Stevens School District trustees on June 10 approved two resolutions to move forward with a planned bond sale and potential refunding while hearing detailed financial analysis from bond counsel and the district underwriter.
Foster Garvey bond counsel Lee Marchisio told the board the School Bond Guarantee Resolution would permit the district to participate in the state's School Bond Guarantee Program, which can lower borrowing costs by leveraging the state's credit enhancement. D.A. Davidson presenters described a financing framework that includes roughly $80 million in new construction bonds to continue the district's construction program and an option to refinance $40 million of 2016 bonds now eligible for call protection release.
Under current market assumptions, D.A. Davidson projected an estimated total net savings of about $1.8 million over the life of the refunded bonds (a net present value of approximately $1.57 million, or a 3.6% savings metric). Presenters cautioned the projection is market-sensitive: a 10 basis-point interest-rate increase would cut savings by about $200,000, and a 35 basis-point rise could eliminate the benefit. Presenters said issuance costs (bond counsel, underwriter commissions, trustee and rating fees) are capitalized into the deal and amount to slightly less than 1% of issuance, and that district administrators retain the legal flexibility to execute or delay the sale through Dec. 31, 2026, while monitoring market conditions.
Director Man Taylor moved approval of Resolution No. 14-26 (School Bond Guarantee), seconded by Director Paul Lund; Director Taylor then moved Resolution No. 15-26 (Delegation), seconded by Director Brian Kesler. Both measures were approved by roll call vote unanimously.
D.A. Davidson said a tentative bond pricing date is targeted for Sept. 15; Foster Garvey and the underwriter will prepare a preliminary prospectus and deliver a credit presentation to Moody's as next steps. Board members praised the clarity of the presentation and framed the measures as part of their stewardship of district finances.
The board approved the resolutions; no additional action to execute a sale was taken at the meeting.
