Nevada County Picayune and Gurdon Times Newspaper Archive

Board moves forward on restructuring debt

Resolutions were adopted by the Prescott School Board to move forward with a special election.

The board held a special meeting Thursday, Feb. 27, with Ray Beardsley, of Raney and Beardsley, Inc., to discuss and approve the resolutions.

The board agreed to Tuesday, May 13, will be the date for the special election, where the Prescott School Districts seeks permission to restructure its bonded indebtedness and raise the millage rate by 3 mill.

Beardsley said 10 percent is added to the figures in case any changes occur.

The district, he said, can revise the figures down, but not up, so the variance is needed for emergency purposes.

By restructuring the debt service to 25 years, the current bonded indebtedness will be paid off in the year 2028. This adds three years to the payoff, but provides the district with $2,035,000 in up-front cash for projects.

The cost of the bonds won't be known until after the election, when they're sold. But, he said, the estimated fee is expected to be $45,690. This includes the fee for Raney and Beardsley, CPA verification and escrow fees.

The resolution showed the district will be applying to issue bonds in the amount of $6,450,000. This is to pay off the current indebtedness and give the district funds for projects.

The application must be approved by the Arkansas Department of Education.

Beardsley offered suggestions for the campaign plan, telling the board if it isn't worked hard, it could fail.

"There will be a lot of confusion for people," he said. This is because if the issue is voted down, the Nevada County Quorum Court will have to impose a 7.6 mill increase to raise the district's maintenance and operation millage to 25 mill as required under Amendment 74.

Another public meeting was suggested to inform the voters of the issues involved, including the ruling made by the Arkansas Supreme Court and how the additional money will be spent.

Under the resolutions, the tax would be levied starting July 1, 2004.

Beardsley said it's better to have the election now because the interest rates are better than they will be in September for those districts waiting until the last minute to seek millage increases.

The May election date also gives the bond firm more time to shop for better rates for the district, should the measure be approved.