T-R FILE PHOTO The Marshalltown Community School Board approved resolutions for bonds for the Reimagine Miller renovation project. The first phase, Series A for $36 million in general obligation bonds, was sold to First Interstate Bank and should be paid off in June.

Besides awarding bid package contracts for Reimagine Miller, the Marshalltown Community School District Board of Education took action on the renovation project bonds during the Monday meeting.

With Board Member Zach Wahl abstaining from the bond votes, they were passed unanimously.

Marshalltown Community School District Executive Director of Finance & Operations Randy Denham brought forward a resolution directing the sale of $3.6 million of general obligation (GO) bonds to First Interstate Bank with a two percent interest rate.

“Series A, as we will refer to it . . . this is what we pre-levied a year ago,” he said. “We’ve issued and are levying the taxes in the current fiscal year for these bonds. . . We were in a position last year with the certified budget to be able to prelevy the dollars so we could have more dollars for the project and also look at paying off the bonds sooner.”

It is a short-term issuance since tax dollars have already been levied for the year. Denham said that when the district collects the April tax payment, they will have the full funds.

“We wanted to make this simple,” he said.

The district put out bids to all of the Marshalltown banks, and a few others within Iowa which have been on similar issuances. However, they only got one response — First Interstate Bank, which is MCSD’s primary bank.

“They gave us a very favorable interest rate on that,” Denham said. “It will be a two-month, short term issuance. We should pay them off in June. One of [their] requirements for this is we have collateral on hand, and we do have funds on hand already. We’ll continue to maintain our working relationship with them.”

As the project progresses, Denham said the district will do more bonds in phases. He added that in a year, they will do a sales tax bond issuance. By going through this process, Denham said the district will be able to shorten the payment time frame by four years.

“We’re going to flip-flop the next few years, but when we get to the last series issuance in 2029, currently we will be able to pay that one down in under 20 years,” he said. “Instead of paying it off in 2049, we’re looking at 2045.”

Denham said some additional estimates are still to come, depending on what happens in the Iowa Legislature with tax reform. With the GO bonds, the district might have some flexibility in not having to levy the full $2.70 in future years, or they could levy the full amount and pay the bonds faster, he added.

Denham also brought forward a proposed motion for the issuance of the next bond phase, Series B for $36.3 million, which will occur in the summer.

“This resolution . . . since we’re in the middle of budget season and we’re not selling the bonds quite yet, we have to authorize this issuance of approximately $53.37 million, which [was] approved by the voters,” Denham said. “We’re not going to prelevy or issue for the full $53 million. . . It’s just a flexibility we have to give ourselves, because we don’t know how much we’re going to sell the bonds exactly for yet. Based on how the sale for Series A came in today, that’s going to allow us to actually levy for a little bit more in the summer.”

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Contact Lana Bradstream at 641-753-6611 ext. 210 or lbradstream@timesrepublican.com.