Los Lunas

The Los Lunas School Board recently approved approximately $1.9 million worth of bond anticipation notes to be sold by the school district through their agent, RBC Dain Rauscher, to help get some much needed projects started sooner.

Rather than wait until October to sell $3 million in bonds, the district is allowed to sell the bond anticipation notes later this year.

The board’s decision will accelerate the work on certain projects by six months, Deputy Superintendent Bill Moffatt said following the school board meeting.

“Instead of putting off projects, this helps us plan and control the work flow. We don’t have to wait and sell the bonds to start work,” Moffatt said.

“The other thing is it helps the cash flow. I can get cash ahead of time to plan projects. This way is much more consistent than selling bonds one or two times a year. This allows a less formal process for the short term of a year or less, based on our future bonding capacity.”

Several years ago, a $14.5 million bond election was approved by the community voters for needed additions, improvements and renovations to local schools.

The Los Lunas Schools plan on adding one full classroom addition for the growing number of kindergarten students at Katherine Gallegos Elementary.

A teacher resource center for the district is also on the agenda.

Moffatt said the district will make improvements to the band room at Los Lunas High School and move ahead with projects such as an additional eight classrooms at Ann Parish Elementary, where portables will be taken away and brick and mortar classrooms will be built.

“We will go ahead with design. Peralta Elementary needs a lot of improvements. They are in desperate need of renovation,” he said.

“These are some of the types of projects we can focus on instead of waiting in October for the next bond sale. We can get additional bond-sale money at that point to put towards these projects and move ahead.”

The 2002 Legislature authorized school districts throughout the state to issue bond anticipation notes. House Bill 18 was passed in January, allowing school districts more flexibility in capital projects planning.

The financing tool provides a mechanism for the district to issue low cost, short-term debt as interim financing. “It’s a good thing that’s being done for the schools,” Moffatt said.

Wells Fargo Bank, the school district’s banker, allows the school district to place the bond anticipation notes privately with an interest rate of 1.75 percent.

“This is a really competitive rate. Extremely low. Now the market for short-term money of a year or less is very favorable. We’re saving money.”

The decision makes Los Lunas the only school district in New Mexico besides Rio Rancho to approve the sale of bond anticipation notes. The only difference is that Los Lunas is placing the sale through a private lender (Wells Fargo Bank) instead of through state government the New Mexico Board of Finance like Rio Rancho.

“We’re on the leading edge here in Los Lunas. For schools, this is cutting edge money management.”

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Jennifer Harmon