School Board initiates bond purchase agreement for Hurricane Ida repairs
Published 12:00 am Wednesday, October 20, 2021
LAPLACE — The St. John Parish School Board passed two motions demonstrating intent to proceed with the financing of up to $30 million to pay for restoration of school buildings in the aftermath of Hurricane Ida.
In a presentation to the School Board on October 14, bond underwriter Toby Cortez shared that other school districts including Calcasieu, Vermillion and St. Landry have utilized bonds to move forward with building repairs while waiting on money from FEMA and insurance.
Once FEMA and/or insurance dollars come through, they may be used to repay the bond.
St. John School Board members voted to join the Louisiana Local Government Environmental Facilities and Community Development Authority in order to qualify for the funds.
The School Board then voted to proceed with the financing. This involves executing a bond purchase agreement and sending an application to the Louisiana Local Government Environmental Facilities and Community Development Authority and the Louisiana State Bond Commission.
Both motions passed with 10 in favor. Board member Ali Burl III voted in opposition due to the School District not having a chief financial officer at this time.
School Board member Debbie Schum compared the process to getting pre-approved for a mortgage.
“We are not necessarily borrowing $30 million. This is the first step of the process. When you are getting ready to buy a house, you get pre-approved for up to $300,000, but that doesn’t mean you’re going to buy a $300,000 house. That is the limit for what you can actually get a loan for,” Schum said.
More information on the interest rate and structure of the loan will be made available to the School Board in December, by which time Board members hope to have more information on how much insurance will cover.
While damage was widespread throughout the district, the LaPlace Elementary and Emily C. Watkins Elementary sites sustained the most damage. Cindy Janecke with All South Consulting Engineers said extensive HVAC, roof and remediation work is required before these sites can welcome students.
The Finance Committee recommended David Andras to serve as the director representing the St. John School Board on the Louisiana Local Government Environmental Facilities and
Community Development Authority’s Board of Directors.
Andras, who also serves as the director of informational technology, is overseeing the District’s finances on an interim basis in the absence of a chief financial officer.
During the October 14 meeting, Andras introduced the comprehensive budget for 2021-2022, which included $2.6 million for the School Board’s cost share for Hurricane Ida repairs. Andras projected a $6.5 million surplus but reminded Board members that a $7.5 million loan payment is due in April 2022.
Andras also shared that MFP funding has dropped $2 million from the previous year due to a decline in enrollment.
“That does not reflect the scholars we are losing this year. That is scholars you have lost already,” Andras said, adding that a significant drop in revenue is anticipated due to Hurricane Ida.
Schum was concerned that the budget was being submitted late, considering it should have been submitted by September 30 for the School Board to maintain an excellent rating or by October 15 to maintain a good rating.
Board president Nia Mitchell-Williams asked if the District is receiving any grace due to circumstances related to Hurricane Ida.
Andras responded, “Needless to say, the state is acting like nothing happened in our district. The state is giving us no extensions on any of our grants, our filing or anything.”
Superintendent Dr. Lynett Hookfin pointed out that the District had complications with power outages and displaced employees for several weeks following the storm.
“We are still moving forward, and what counts is that the information will be submitted regardless,” she said.