WO-C OKs plan to lower 2008 bond debt

Dave Rogers

For The Record

In a move they hope will save their district about $2 million in interest payments over the next 22 years, West Orange-Cove school trustees voted Monday night to authorize the refinancing of about $9.2 million worth of construction bonds issued in 2008.

Lewis A. Wilks of U.S. Capital Advisors, the district’s longtime public finance consultant, predicted quick action could lower the interest rate due on the bonds from 4.69 percent to 2.57 percent.

That, he said, would lower the finance cost 16.2 percent, saving the district $1.94 million.

“Our goal is to refinance a series of bonds to take advantage of lower interest rates available now,” explained WO-C superintendent Rickie Harris. “The savings will be used to pay down additional bond debt.”

After obtaining the board’s 6-0 approval (trustee John H. Gray, Jr., was absent), Wilks and the district’s Houston bond attorneys at the Andrews Kurth firm expect to lock in the new lower rate by Oct. 6, attorney Ben Morse said.

But both Wilks and Morse acknowledged the possibility that rates could rise in the meantime. Built into the agreement approved by trustees Monday was a stipulation the deal would only go forward if it achieved at least a 10 percent savings for the district and carried the final OK of one of three WO-C administrators, Harris, finance director Robin Hataway or Wayne Guidry, executive director of operations.

The school district issued a total of $39.7 million in 2008 bonds, Wilks noted, but he said refinancing was limited to an amount less than $10 million a year to keep the bonds tax exempt and attractive to would-be purchasers.

The consultant said that, barring unforeseen problems with October’s refinancing, he could foresee an annual repeat of the process for the remaining original bonds over the next few years.

Earlier in Monday’s monthly board meeting at the WO-C Administration Building, Hataway announced the district had won its first Superior rating since 2013 for its management of the district’s financial resources.

The state's school financial accountability rating system, known as the School Financial Integrity Rating System of Texas (FIRST), ensures that Texas public schools are held accountable for the quality of their financial management practices and that they improve those practices. The system is designed to encourage Texas public schools to better manage their financial resources to provide the maximum allocation possible for direct instructional purposes.

Each year’s ratings are based on data from two years in the past. This is because school districts’ annual audits can take up to a year to complete.

WO-C scored 90 of a possible 100 points for its Superior rating, Hataway’s report stated. It was the district’s fourth Superior rating in the 14 years FIRST ratings have been issued, according to the Texas Education Agency website, with 2008 and 2009 marking the other Superior awards.

This year’s recognition followed an upward trend since WO-C was rated Standard in 2013. The district rated Above Standard in 2014 and last year earned a “passing” rating when only pass/fail ratings were issued. All four Superior ratings have come since WO-C received Substandard ratings in 2004-05.

Also in Monday’s meeting, trustees approved District and Campus Improvement Plans for 2016-17.

The plans were full of individual assessment and tutorials, inclusion of Special Education students in “mainstream” classes and featured journaling as a big component on all grade levels.

“The purpose is to get the kids writing,” said Glenetta Henley, principal of West Orange-Stark Elementary. “We want to get them comfortable with it. Right now, they aren’t comfortable with it.