By Jean Doran Matua, Editor
Last November, voters in the Eden Valley-Watkins school district voted to approve a building referendum of $8 Million that included all three school buildings in the district. Work has been ongoing since the election on specific plans for the high school (especially upgrading the 1929 building), and elementary schools (especially safe entrances).
Following the prescribed schedule, the bond for this project was put up for bid last week and, at its Feb. 27 regular meeting, sale of the bond was approved.
Coming as great news was the fact that interest rates have shifted since the election information was put together in August. The winning bid was for just under 3 percent interest; it had been projected at 4.35 percent. This interest savings alone will save the district $1.57 Million over the life of the bond. This savings amounts to a 28.4-percent decreased impact to taxpayers over the 2018 estimates. (With the average EV-W home valued at $125,000, the tax impact is now expected to be $59/year rather than the earlier estimate of $82/year.)
The final bond sale was for $7,960,000 to Piper Jaffray, the lowest among the six bids received.
A large part of the reason for the much better bid price is the district’s A1 credit standing with Moody’s, the district’s conservative budgeting over the years, a growing fund balance since 2012, and the district’s decision last fall to pay additional principal payments over the first 10 years of the bond. This strong and conservative financial management impressed both investors and underwriters, leading to the better rate on the bond this year.
Another tax savings to district taxpayers is the farm credit implemented last year in Minnesota. About 11 percent of debt service payments on the $7.96 Million bond will be on agricultural land. Since Minnesota ag land can no longer be taxed for school building levies, that means that those taxpayers will receive $1.3 Million in tax credit (with credit received after taxes are filed). This means that 11 percent of the total bond, or $1.3 Million, will be paid by the state instead of by taxpayers.
A Facility Committee is now in place to handle any change order decisions that arise during construction. Board members Rob Flaschenriem and Bob Stenger sit on this committee along with superintendent Mark Messman.