DALLAS St. Tammany Parish Wide School District No. 12 in Louisiana will issue the first tranche from $167 million of debt authorized by voters in March with Thursday's competitive sale of $67 million of 20-year general obligation bonds.
Many parish residents work in New Orleans, about 25 miles south of the parish, which is located on the northern shore of Lake Ponchartrain. The parish experienced an increase in population after Hurricane Katrina in August 2005, as an estimated 65,000 displaced residents from St. Bernard, Orleans, Jefferson, and Plaquemines parishes relocated to St. Tammany.
The population in the parish has grown significantly over the past eight years, to an estimated 226,000 in 2007 from 191,000 in 2000, according to U.S. Census figures. Parish officials estimate the current population at between 275,000 and 300,000, but expect the number of permanent residents to stabilize at approximately 255,000.
The school district saw its daily enrollment fall by approximately 6,500 students after the storm as residents in the southeastern side of the parish were displaced. However, enrollment quickly rebounded as many of those uprooted from other parts of Louisiana and Mississippi by Katrina decided to stay in St. Tammany Parish.
The district had 35,124 students at the end of the 2004-2005 school year, and 34,346 at the end of the spring 2006 session. The current enrollment is 35,523, with district officials expecting a 2% to 3% enrollment growth a year.
District spokeswoman Linda Roan said it was and remains difficult to determine exact population numbers in the wake of the hurricane.
"There's never been any real conclusive set of numbers about what the population of the parish is or was, before or after the storm," she said. "There has been so much movement, a constant state of flux. We had residents moving out, and people from other parishes flowing through with some deciding to stop. It was a tremendous ebb and flow, but the numbers have stabilized and we're at our pre-Katrina levels."
Bond counsel for the district is Foley & Judell LLP.
The bonds have an underlying rating of AA from Standard & Poor's, which last week upgraded the district's debt from AA-minus. Moody's Investors Service has yet to issue a report on Thursday's sale, but currently provides an unenhanced rating of Aa3 for the district's debt.
The bonds will be insured through Assured Guaranty Corp.
Brett Stoltz, director of business affairs for the district, said the district expects to pay a more favorable interest rate than it would on uninsured bonds.
"In today's market place, bond insurance makes good sense," he said.
Stoltz said the upgrade by Standard & Poor's affirms the district's strong financial position.
"This gives us the highest rating of any school district in Louisiana," he said. "It means we'll continue saving money for the district."
Stoltz said the district expects to issue another $50 million of the bonds in summer 2009, with the final $50 million going to market in 2010. The bonds will not require an increase in the district's property tax rate of 21.9 mills.
The St. Tammany school district currently has $162.5 million of outstanding GOs.
The bond package, which was approved by 68% of those voting in the March election, includes $149.9 million for new and expanded facilities, $15 million for new technology, and $2.1 million for security measures. It was the seventh school bond issue approved by parish voters since 1990.
Roan said the district is striving to handle enrollment growth that began before the hurricane hit in 2005.
"We have been in a catch-up mode for many years," she said. "These new facilities will allow us to catch up with the growth that has already occurred."
The district will spend $50 million for new facilities, including a new elementary school and an advanced studies center for high school students, but will devote almost $100 million of the bond proceeds to expansions and upgrades at its existing schools, according to Roan.
"We pride ourselves on continuing to maintain our existing schools," she said. "We made a pledge to the community that we are not going to ignore what we have built."