DALLAS — Oklahoma County Independent School District No. 1 will exhaust a 2007 authorization and sell the first bonds from a successful November election with today’s competitive sale of $15.5 million of general obligation bonds.
The sale of the five-year bonds will leave the district with $76.3 million remaining from the $80.6 million of bonds approved by voters on Nov. 9. The total includes $74.5 million of building bonds and $1.8 million of transportation bonds.
The district intends to issue another $41.2 million of the 2009 authorization in January 2011, $25.8 million in January 2012, and the final $18.8 million in January 2013.
With the sale, the district will have $66.3 million in outstanding debt as of Jan. 1.
Ron Fisher of Stephen H. McDonald & Associates, the district’s financial adviser, said an interest rate of 3.5% was assumed in the financial projections, but the actual interest should be lower.
“We’re hoping to get 2.75% to 2.5%,” he said. “Oklahoma doesn’t have a lot of rated school bond sales, but we’ve been doing pretty well lately with some small unrated issues.”
The district’s debt is rated A-plus by Standard & Poor’s.
The Floyd Law Firm PC is bond counsel for the district.
Several future GO bond issues will provide proceeds to support lease-revenue bonds, but this offering does not, Fisher said.
“The proceeds from this sale will help finance some projects that will be acquired with the lease-revenue bonds, but those will be issued later,” he said. “It wasn’t necessary at this point.”
Proceeds from some $54 million of the $80.6 million of GO bonds authorized by voters last month will be used to acquire property financed with lease-revenue bonds issued by a local trust authority.
Fisher said Oklahoma allows districts to acquire specific components of buildings financed with proceeds of lease-revenue bonds, but not a percentage of the buildings themselves.
“For example, the district can acquire the floors or the heating systems financed with the lease-revenue bonds, but not 25% of the structure,” he said. “There can be no undivided interest. But the district can eventually acquire 100% of the components.”
Steve Lindley, director of communications for the school district, said bond proceeds would be used to upgrade and improve the district’s aging facilities.
“We will finance more than 100 projects with the total bond package,” he said. “The average age of our schools is 38 years, and several are more than 50 years old.”
Five more schools in the district will be equipped with geothermal systems for heating and cooling, Lindley said, which will shave energy costs by $1.7 million over the next 10 years.
The 47-square-mile district, which serves the northwestern portion of Oklahoma City, has some 19,000 students. It operates 18 elementary schools, five middle schools, and three high schools.