CHURUBUSCO — With interest rates at the lowest in recent history, Smith-Green Community Schools took expert advice and is now $6 million in debt with its eye on a new cafeteria, more classrooms, secured entrances at both schools and to be American Disabilities Act compliant.
Jim Elizondo, of City Securities Corporation, was on hand Monday at SGCS public work session and told the board they are looking at less than a three percent rate for bond issues.
“I have two options for you to consider,” said Elizondo.
“You can wait to issue bonds until September. That way we don’t have to pay interest. You will accrue bills from the architects. It will be a very small interest rate fluctuation.”
Elizondo said, “The trade-off is you told the public you are going to spend six million which means you will sell six million in bonds. You will have lower interest in debt service.”
He made the recommendation to go ahead and let him sell bonds to the public.
Rick Trump, board member, asked what the school’s credit rating is.
“I would hope that it would be an AA+, this is because you get state and federal aid. A true credit rating would be A+,” said Elizondo.
“With the presidential race looming I think we should go ahead and sell,” said Trump.
Todd Fleetwood, business manager, reminded the board about the bills from architecture firm Moake Park.
“The bills are near $59,000 and they keep accumulating,” said Fleetwood.
“We should proceed in the bond issue. We can lock in the rates and be in place for the building project. I see no benefit in waiting until September,” said Trump.
The board agreed and advised Elizondo to sell the bonds.