The Kearny Board of Education is refinancing nearly $16 million in old school bonds in hopes of trimming some of its debt payments over the remaining life of the bonds.
The board authorized the action on March 16.
Michael DeVita, the board’s secretary/business administrator, said that Moody’s Investors Service has given the bonds an A1 rating, which, he said, should assure a competitive interest rate on the refinancing. DeVita said the board originally floated two bond issues, one in 2005 for $3,650,000 for repairs to elementary school facades and another in 2007 for $12,725,000 for the high school façade.
“We pay off a portion of the debt on those bonds each year and we always check the market rates to see if it’s feasible to refinance,” DeVita said. “In past years, the savings projected were not enough to go forward with that.”
But this year, the forecast was brighter, he said.
“Now, our experts – bond counsel Andrea Kahn of McManimon, Scotland & Baumann, financial adviser Diana Geist of NW Financial and auditor Gary Vinci – estimate that through refinancing, we will realize a 5% net savings over the remaining life of the bonds through June 2026,” DeVita said.
That savings, he said, has been projected at about $350,000 on the $8,498,125 of debt still outstanding on the bonds.
Meanwhile, DeVita said the district hopes to bid out a contract for installing new soundproofed windows for Kearny High School and finish that work by this summer.
Mark Bruscino, the district’s school plant operations director, said that 60% of those windows are already available, having been previously fabricated by a sub-contractor for Brockwell & Carrington, the former vendor who was entrusted with the high school improvement job until the firm was “terminated for convenience.” The remaining 40% still have to be ordered and manufactured, he said.
By summer’s end, DeVita said, the district should be ready to seek bids for the improvements on the high school’s North Building, which will involve steel supports for a modified atrium, new classrooms and a cafetorium.
Plans now call for completion of the high school project by between 2017 and 2018, according to DeVita.
Whether the district will end up with enough money from the roughly $40 million budget allocated by a combination of funding from the Federal Aviation Administration, Port Authority of N.Y. & N.J. and state Department of Education to finish the job remains to be seen.
A forensics audit by D’Arcangelo & Co. of Poughkeepsie, N.Y., previously commissioned by the school board at the urging of former Schools Supt. Frank Ferraro was designed to inform the board how much had been spent on the project.
The district has said that it has received only a preliminary report which it has refused to share with The Observer, which filed an OPRA request for the document, on the grounds that because it is still incomplete, it is not a public record.
– Ron Leir