Cape Girardeau School Board authorizes bonds for district improvements

Three programs through the stimulus package will give the Cape Girardeau School District a boost as it begins administering its $40 million bond issue.

The school board met in a special session Tuesday to authorize bonds. District officials and financial advisers outlined the benefits of bonds acquired through the American Recovery and Reinvestment Act.

In April, district voters approved a bond proposal to build a new elementary school and a new event complex and auditorium at the high school. The district will also address safety concerns and deferred maintenance. Roof replacements are set to begin this summer.

The district will use $25.3 million in Build America Bonds. The federal government covers 35 percent of interest on the bonds.

The district will also sell $4.2 million in Qualified School Construction Bonds, which are interest free. Bondholders receive federal tax credits in lieu of interest paid by the district. Cape Girardeau was one of 60 school districts statewide to receive $146 million in the second round of the bonds.

The district will use $3.38 million of Recovery Zone Economic Development Bonds, which were allocated through the county. The federal government covers 45 percent of interest on those bonds. The balance of the $40 million proposal, $7.09 million, will be tax-exempt bonds.

The district's financial adviser from Stifel Nicolaus told the board overall interest costs over a 20-year financing period will be 2.76 percent.

"That's truly remarkable," said Lorenzo Boyd, senior vice president of public finance with the company.

Superintendent Dr. Jim Welker said the lower interest rates will not free up money for more projects or other district expenses. Because the district will pay less in interest, the rates will bolster the district's finances in the future. The district could pay off bonds sooner or do another bond issue without increasing the tax rate.

"It just reduces our debt service requirements," Welker said.

Roof projects will be bid out later this week, said Neil Glass, director of administrative services. He said the roofs on Clippard and Alma Schrader elementary schools are expected to be complete by the end of September.

During the meeting, the school board also voted to apply for a grant that could supplement projects in the bond issue. A hazard mitigation grant awarded through the Federal Emergency Management Agency would pay 75 percent of the cost to construct a safe room.

Glass said the funds could be used toward the auditorium at the high school. It would then be a safe room for students at the high school and nearby Cape Girardeau Career and Technology Center. The agreement would require a $560,000 match from the district, which is already funding the project through the bond proposal.

The school board also outlined voting procedures for filling the vacancy created by the resignation of Dr. Steve Trautwein. The board will meet at 6 p.m. Tuesday to interview the five people who applied for the position. Board members will meet the next day at noon to cast votes and choose the new member.

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