A school district in Lonoke County, Arkansas, issued more than $40 million in bonds to refund a previous issuance and finance capital improvements to schools in the district.
The bonds, issued by Cabot School District No. 4, mature between 2033 and 2048. They yield between 3.1% and 4.2%. The issuance also included two term bonds: the first consists of $6 million and matures on February 1, 2043; it yields 4%. The second consists of $14 million and matures on February 1, 2053; it yields 4.25%. The securities received a rating of Aa2 from Moody’s Investors Service.
“Bond issues allow the district to pay for costly renovations and new projects over time rather than all at once. This makes it possible for the district to devote more of its operating budget to student instruction,” according to the school district’s website advocating for the issuance.
The bonds were authorized in a special election last month. Most of the issuance will pay for the construction of two new pre-kindergarten centers, a district daycare facility, and a multiuse practice pavilion. The bonds will also pay for upgrades to school flooring and student activities facilities. The district expects most construction to commence next year.
The bonds are limited general obligations on the school district, secured by a pledge of proceeds from a continuing debt service tax.
Robert W. Baird & Co, Inc served as lead underwriter on the issuance, purchasing the bonds for slightly less than par. The price reflected a discount of less than $1 million.