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Brenham ISD financial advisor outlines $39 million bond plan, forecasts March closing
Summary
District financial advisor told the board the district expects to complete a $39 million bond sale with closing and funds available in March; officials said the bond is structured to keep the district's tax rate unchanged and noted an expected modeled interest rate of about 4.62%.
District financial advisor Steven Perry briefed the board on the status of the $39 million bond sale and the timeline to closing. Perry said conditional PSF guarantee approval is in hand, underwriters are selected and staff will return with pricing at the Feb. 17 meeting. "Roughly 30 days later, you'll have money in the bank, March 17 is currently the plan, and you'll get all $39,000,000," he said.
Perry walked trustees through sources and uses, explained the practice of capitalizing the first interest payment to protect the tax-rate promise, and discussed arbitrage rules should short-term investment rates climb above the borrowing rate. CFO Dale St. Clair said proceeds will be placed in appropriate construction and investment accounts and that the district will track reimbursements to the general fund for approved prior expenditures.
