Mt. Lebanon approves new bond issue

Published Aug 20, 2013 at 4:11 am (Updated Aug 19, 2013 at 11:20 pm)

The Mt. Lebanon school board voted, 8-1, to approve the second bond issue for the district’s high school construction project at its Aug. 19 meeting. The gross amount issued will be $34.74 million and the district will receive $32.95 million after fees. Board member Scott Goldman cast the lone no vote.

Tim Frenz, director of public finance at Janney Capital Markets, explained interest rates were higher this week than when he made his last presentation to the board. As a result the millage impact of the issue will be .59 mills spread over three years, up from a previous estimate of .55 mills.

“This was still a good time to get into the market,” Frenz said. “We are projecting that interest rates will continue to march upward. We are also seeing other issuers jump into the market for that reason. Allegheny County is auctioning $190 million next week.”

Frenz added that the bonds have a 10-year call feature, and that due to the wrap structure about $32.8 million of the issue will be eligible for refinancing. A call option essentially allows an issuer to redeem bonds early, replacing them with lower interest debt.

The district will receive the proceeds from the sale on Sept. 24.

The board also approved a 4 percent salary increase for superintendent Dr. Tim Steinhauer, to $163,776.

School board president Elaine Cappucci said, “this has been an exceptional year for our district and Dr. Steinhauer has proven an effective and capable leader. He has achieved all the goals the board set for him, including sound fiscal management and supervision of the high school project. Multiple measures of student achievement have also shown improvement.”

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