The school board has decided to use a wraparound structure for the second bond issue vs. level payment. With the cushion, a.k.a over taxing, that the school board has established, the board has decided to use capitalized interest. The cushion could be used for OPEB, the grievance, the rifle range, etc.
Tim Frenz, again did not have a presentation for the public. He resorted to pointing to his papers, rather than sharing the information on the screen to his left. In all my years of making sales presentations for my $5 million territory, I would have been fired for being so unprofessional. Josephine Posti said it in a nutshell. The public does not have the figures that the board has to see, to know that they are making a good decision. Why not, Josephine? She went after Scott Goldman when he voted in favor of level funding. He calculated that level funding will cost the district $5.6 million LESS. By wrapping this bond, we will be paying 19% MORE. She said that it will cost us more in millage. Scott tried to explain that we have the option to refinance a level bond issuance, as well, while saving taxpayers $5.6 million dollars. Cappucci, Birks, and Posti all pounced on him.
The good news is that Moody's has given Mt. Lebanon an AA1 rating.
I am not pretending that I am an expert on this topic. It is complicated to me, so please listen to the podcast for a better explanation. It is available here.
6 comments:
The Directors went after Goldman for exposing $5.6 Million more in waste on a municipal bond issue. That brings the total squandered on the HS project to $40 Million.
Shame on Janney for not being more professional.
$10 Million of the waste is in Janney bond issues.
No wonder the Board needs to raise voluntary funding.
John Ewing
Five $1,000 bonuses and 4 percent annual raises seem very insignificant compared to numbers noted by 9:49. Maybe the District should start playing the powerball. Finishing the project "on time and under budget" will help taxpayers feel better when making their yearly contributions.
Page 2 of the updated Debt Profile
http://www.mtlsd.org/District/Stuff/MTLSD%20Update.08.12.13.pdf
does have $1.2 million capitalized interest.
Mr. Frenz did not explain to the board both options have capitalized interest.
On July 15, 2013, Mr. Frenz presented two options.
The first option was $32.95M.
The second option was $30M.
On August 12, 2013, Mr. Frenz presented two options.
Both were $32.95M.
What happened to the $30M option presented in July?
Did the board vote to only consider $2.95M more?
Why didn't any of the elected officials speak up about this?
At least Scott seems to have his head screwed on straight.
On both bond floats these same directors chose the path of least resistance for immediate millage impact while ignoring the long term ramifications of kicking the can down the road 20 years.
Scott was right. I am sure the directors had the numbers right in front of them just like in 2009 and decided to go with the higher cost option. $3million more in 2009 and $5 million more now.
I'd say it's unbelievable but this community has elected some serious fiscal illiterates to the board.
Keep it up, school board, and Moody's soon will be losing Mt. Lebanon's contact information.
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