Net savings of about $304,257 of future interest expense

The Board of Education of the Rock Port R-II School District of Atchison County, Missouri, approved a parameters resolution at a regular meeting on October 14, 2021, that authorized a final terms committee consisting of Jeremy Davis, Board President, Ethan Sickels, Superintendent, and Larry J. Hart, CEO of L.J. Hart & Company. It approved the sale of $3,080,000 General Obligation Refunding Bonds to its Municipal Bond Underwriter, L.J. Hart & Company of St. Louis, Missouri, within certain reoffering yield ranges. On November 4, 2021, the final terms committee was able to lock in interest rates for the Series 2021 Refunding Bonds with reoffering yields ranging from 0.30% to 1.20% to constitute a new effective rate of 1.04%, compared to the average interest rate of 2.82% for the Series 2015 and Series 2017 Bonds being refunded. Through this refinancing, the district reduces future interest expense by $304,257 and shortens the final repayment period by one full year. It is the result of the extremely strong current municipal bond market that is producing nearly historically low interest rates as well as the good name of the district in the municipal bond credit market. The district previously captured $721,007 of savings with the Series 2015 and Series 2017 Refunding Bonds that, respectively, refinanced the Series 2010A and Series 2014 Bonds. This $304,257 plus the savings of $1,708,393 from previous refundings and prepayments means that the district has saved $2,012,650 of interest expense since 2010.

Ethan Sickels, Superintendent of Schools, expressed enthusiasm and support for the refunding option selected by the Board of Education. “This plan achieves significant savings and allows the district to capture better conditions in the municipal bond market for the benefit of our taxpayers. It also preserves considerable flexibility for the district in the future for building improvements with no-tax rate increase opportunities,” Mr. Sickels remarked.

Thomas J. Pisarkiewicz, President of L.J. Hart & Company, prepared the refunding proposal and explained how it can fit into the long-range plans of the district. He mentioned that the three significant factors making the Series 2021 refunding attractive were the lower interest rates than in 2015 and 2017, the fact that the Series 2015 and Series 2017 Bonds are subject to prepayment at no penalty, and the district’s ability to participate in the State of Missouri’s Direct Deposit Program. This program makes it possible for the district to receive an “AA+” rating from S&P Global on the refunding bonds. Mr. Pisarkiewicz complimented Mr. Sickels for his prompt and thorough preparations to supply the data necessary for the official statement, as well as the Board of Education for their foresight in making the Series 2015 and Series 2017 Bonds callable in five years. The Series 2021 Refunding Bonds will have a five year call feature of March 1, 2026, at no penalty.

The Series 2021 Refunding Bonds were made available to local financial institutions as part of the marketing procedure. Citizens Bank & Trust has agreed to purchase $475,000, and Nodaway Valley Bank has committed to $1,245,000 of the bonds. The closing for the Series 2021 Refunding Bond issue is to occur on December 7, 2021. Mr. Sickels stated that he was pleased efforts were made to accommodate local investors. “It is great that our marketing procedures facilitated this local involvement while still receiving attractive interest rates, and we appreciate the strong local support from Citizens Bank & Trust and Nodaway Valley Bank,” Mr. Sickels commented.

Several board members commended Mr. Sickels and L.J. Hart & Company for developing the attractive refunding plan. “We are glad to be able to save $304,257 of our taxpayers’ money by taking advantage of the most favorable conditions in the municipal bond market in over 60 years,” stated Jeremy Davis, President of the Board of Education.