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Frankenmuth Fire Dept.
With the bonds sold, FSD turns its attention to campus improvements
Over $15 million, authorized through the Frankenmuth School District’s August 6 millage election, is ready to be put to good use for building and site improvements across the school campus.
The FSD Board of Education recently announced the successful sale of its 2019 school building and site bonds, courtesy of the August 6 election. The total proceeds are $15,028,000 and are being used for the purpose of erecting, furnishing and equipping additions to and remodeling, furnishing and refurnishing, and equipping and re-equipping school buildings; and erecting, furnishing, equipping, developing and improving playgrounds, athletic fields, athletic facilities and sites; and paying costs of issuing the bonds.
Installing new artificial field turf on the football and soccer fields in May 2020 is just one of the bigger ticket items for the FSD.
In preparing to sell the 2019 school building and site bonds, the FSD, working with their municipal advisor, PFM Financial Advisors LLC, requested that S & P Global Ratings, a business unit of Standard and Poor’s Financial Services LLC (S&P), evaluate the school district’s credit quality.
S&P assigned the FSD the underlying rating of AA- with a stable outlook.
“The rating agency cited the school district’s very strong fund balance and stable budgetary performance, strong incomes and extremely strong wealth levels, and good financial management practices in their rationale for rating of the FSD at this level,” FSD Superintendent Adele Martin said.
It was good news for Martin, the school board, staff and students.
“We are pleased to learn that the district was recognized for its good financial stewardship. With proceeds from the sale, we look forward to the opportunities for improvements in safety, classrooms, media centers and outdoor facilities. Our students, staff and community will benefit from the changes. The district is grateful for the supportive community,” Martin stated.
The FSD’s financing was conducted by the Michigan investment banking office of the brokerage firm, Stifel, the municipal advising firm, PFM Financial Advisors LLC and the law firm serving as bond counsel, Thrun Law, P.C. The district’s 2019 building and site bonds were sold at a true interest rate of 2.40 percent with a final maturity of 2036 – a repayment term of approximately 17 years.
"Frankenmuth School District’s bonds were well received by the bond market,” Stifel Managing Director Brodie Killian said. “The district’s excellent credit rating helped attract a group of high-quality investors – including over $1 million of orders from individual retail investors. The interest rates achieved will allow the rates taxpayers pay to be lower than originally anticipated.”
Under state law, bond proceeds may not be used to pay administrator, teacher or staff salaries, routine maintenance costs, or other school operating expenses. The money generated must be directed toward improving the Frankenmuth School District facilities so that programs can be enhanced