Grand Island Public Schools
123 South Webb Road
Grand Island, NE 68802
Your Legacy.
Their Opportunity.

Enhancing opportunities by seeking and securing resources for projects, scholarships and programs.

Access digital copies of our district flyers.

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PURPOSE
This Debt Policy sets forth a comprehensive guideline for the financing of capital expenditures by Grand Island Public Schools (District). The primary objectives of the policy are as follows;

  1. Establishing debt issuance practices for obtaining financing when needed
  2. Setting an efficient process for identifying the timing for and amount of debt or other financing
  3. Obtaining optimal interest rates, controlling other issuance costs and reducing risk where possible
  4. Conforming to all applicable state and federal laws and contractual obligations

USE OF DEBT FINANCING
Debt financing, to include general obligation bonds, certificates of participation, lease/purchase agreements, and other obligations permitted to be issued or incurred by school districts under Nebraska law, shall be used only to: purchase equipment, acquire real property, construct facility additions or renovations, or other similar improvements. The useful life of the asset or project shall exceed the maximum average life of any debt the District incurs in order to acquire the asset or project.

RESPONSIBILITY
The primary responsibility for developing financing recommendations rests with the Chief Financial Officer (CFO). No less than annually, the CFO, or designee, shall prepare for the Facilities and Finance Committee (or full Board of Education) a written report on the status of Capital Improvements Program (CIP) financing. The report shall include a projection of near-term financing needs compared with available resources, an analysis of the impact of contemplated financings on the Long-Range Financial Plan and the CIP, and financing recommendations. In developing financing recommendations, the CFO, or designee, shall consider the following:

  1. The expected spend time of bond or other proceeds, and any related carrying cost
  2. Options for interim financing, including near-term and interfund borrowing, taking into consideration federal tax reimbursement regulations
  3. Trends in interest rates
  4. Other factors as may be appropriate

INVOLVEMENT OF ADVISORS
The District recognizes the importance of engaging legal counsel and possibly other professionals in connection with complex financial matters. Accordingly, the District will engage counsel to represent the District in connection with most financings in order for the District to have proper representation.

Bond Counsel
Bond Counsel shall be selected by the District and engaged to represent the District, and shall be nationally recognized in matters of Nebraska municipal law and federal tax-exempt law. Bond Counsel will issue an opinion as to the validity and tax-exempt status of interest on all obligations issued as tax- exempt indebtedness. In coordination with the CFO, Bond Counsel will be responsible for preparing the Board resolution authorizing issuance of obligations; drafting any bond purchase agreement, installment contract or other operative instrument; drafting all of the documents required at closing; and providing other services as determined by the CFO.  In addition, the CFO, or designee, may seek the advice of Bond Counsel on other types of financings and from time to time on any other questions involving state law or federal tax law or regulations.

Disclosure Counsel
The District may engage Disclosure Counsel to assist the District with preparation of the Official Statement (as described below). Disclosure Counsel shall be nationally recognized in matters of federal municipal securities law. In coordination with the CFO, Disclosure Counsel will assist the District with drafting the Official Statement and coordinate disclosure due diligence matters.
The CFO, or designee, also may seek the advice of Disclosure Counsel from time to time on questions involving federal securities matters.

Financial Advisor
The District may engage a Financial Advisor if determined appropriate. The Financial Advisor will advise the District on the structuring of obligations to be issued, inform the District of various options, advise the District as to how certain choices will impact the marketability of the District’s obligations, and provide the District other services as determined by the Board of Education (Board). The District’s Financial Advisor shall meet the definition of a “municipal advisor” within the meaning of federal securities laws and shall accordingly owe the District a fiduciary duty.

SHORT-TERM DEBT

General
Short-term obligations may be issued to finance projects or portions of projects for which the District ultimately intends to issue long-term debt; i.e., it will be used to provide interim financing that eventually will be refunded with the proceeds of long-term obligations. Short-term obligations may be supported by a tax pledge, or a pledge of other available funds of the District as in each case may be permitted by Nebraska law.

Interim
Interim financing may be appropriate when long-term interest rates are expected to decline in the future. In addition, some forms of short-term obligations can be obtained more quickly than long-term obligations and, thus, can be used in emergencies until long-term financing can be obtained. In some cases when the amount of financing required in the immediate future is relatively small, it may be more cost-effective for the District to issue a small amount of short-term obligations to provide for its immediate needs than to issue a larger amount of long-term obligations to provide financing for both immediate and future needs when the carrying costs of issuing obligations that are not immediately needed are taken into account.

Cash Flow Borrowing
The District may incur short-term obligations if tax revenues are expected to result in a period where the District will experience a negative cash position in one or more of its funds. If possible, the conditions which necessitate any such borrowing should be corrected in order to avoid any such cash flow borrowings in the future.

LONG-TERM DEBT

General
Long-term obligations will not be used for operating purposes, and the life of the obligations will not exceed the useful life of the projects financed. Debt service structure will approximate level annual debt service unless it is determined appropriate by the Board to otherwise structure the amortization to fit with the amortization of other obligations outstanding or expected to be incurred. The District will strive to limit its annual issuance of long-term tax-exempt obligations to $10 million to take advantage of federal tax rules for bank-qualified debt. Should subsequent changes in federal tax law increase applicable bank-qualified limits, the District's policies will be adjusted accordingly.

The cost of taxable bonds is typically higher than for tax-exempt bonds. However, the issuance of taxable debt is necessary in certain instances that would allow the District valuable flexibility related to the use of a financed facility or covenant structures. Therefore, the District will typically issue tax- exempt obligations but may issue taxable obligations.

Bonds
Long-term general obligation bonds may be issued to finance significant capital improvements for purposes set forth by the Board when authorized by voters in a properly called election or as otherwise permitted under Nebraska law. Bonds will have a maximum average life of the lesser of (a) the average useful life of the facility being financed and (b) 25 years. Outstanding general obligation bonds of the District shall never exceed in the aggregate 5 percent of the assessed valuation of all taxable property in the District.

Call provisions for bond issues shall be made as short as possible, consistent with the lowest interest cost to the District, and as may be required by Nebraska law. When feasible, all bonds shall be callable at par.

Method of Sale
Debt obligations may be issued by either negotiated sale, competitive sale or privately placed directly with a purchaser. From time to time and at the sole direction of the District, but prior to issuing debt, the District will select an underwriter via a due diligence process to be utilized for negotiated sales. The District and the Financial Advisor, if applicable, will participate together in the selection of the underwriter. If the District determines to utilize a competitive sale process, the sale will be structured to ensure the most favorable bid for the District, upon the advice of the Financial Advisor, taking into account market conditions and other prevailing factors.

Sale Parameters
Parameters to be examined in connection with any bond issue may include the following:
·  Limits between lowest and highest coupons
·  Coupon requirements relative to the yield curve
·  Method of underwriter compensation
·  Use of true interest cost (TIC) versus net interest cost (NIC)
·  Use of bond insurance or other credit enhancement vs. a standalone individual bond rating
·  Permissible amount of original issue discount or premium
·  Call provisions 

REFUNDING
The District shall consider refunding debt whenever an analysis indicates the potential for minimum net present value savings of approximately 4 percent of the principal being refunded or at least $750,000. The District will not refund less than 5 percent of its outstanding debt at one time except in unusual circumstances, such as when it intends to change bond covenants or for other favorable business objectives.

CAPITAL LEASING
Capital leasing or lease/purchase agreements may be used for the acquisition of a capital asset with a cost of less than $2,000,000.

Whenever a lease is arranged with a private entity, a tax-exempt interest rate shall be sought. When a lease is arranged with a government or other tax-exempt entity, the interest rate should be taxable and the obligation should likewise not be subject to federal tax-exempt bond rules or regulations.

The lease agreement shall permit the District to refinance the lease at no more than reasonable cost should the District decide to do so. In assessing a lease arrangement, the District will consider call and acceleration provisions to achieve the most favorable approach.

Since the market for lease financings is relatively inefficient, the interest rates available at any one time may vary widely. Therefore, the District shall seek competitive proposals for any major lease financing. The net present value of competitive bids shall be compared, taking into account whether payments are in advance or in arrears and the frequency of payments. In addition, the District will consider the cost of lease financings compared with other financing potentials. If possible and cost-effective, the purchase price of equipment shall be bid competitively and separately from the financing cost.

The District's Bond Counsel shall be engaged to review any leasing arrangement proposed to be structured as tax-exempt, and may be engaged to review taxable leasing arrangements if determined appropriate by the CFO. The District may consider issuing certificates of participation to finance large projects.

OTHER TYPES OF FINANCINGS
From time to time, other types of financings may become available, such as debt pools with other entities and low-interest loans from state agencies. The CFO, or designee, will prepare a written analysis of such options. This report will include consideration of the legal advice of the District's Bond Counsel and, if applicable, the advice of the District’s Financial Advisor.

OFFICIAL STATEMENT
An Official Statement is the disclosure document prepared by the District for an offering of municipal securities in the aggregate amount of $1 million or more. It is used by the underwriter to market the District’s bonds, and typically describes the District, the financing plan, certain tax matters, and the security for the bonds or other obligations being offered pursuant to the Official Statement.

Responsibility
The preparation of the Official Statement is the responsibility of the District, but completion of the Official Statement will be managed by the CFO, with input from departments and divisions throughout the District as determined appropriate. The District’s counsel, Financial Advisor, or underwriter may provide additions or suggest changes to the District’s Official Statement. The District will participate in due diligence sessions with underwriters and counsel, and may consult with Disclosure Counsel on matters that may require disclosure in an Official Statement.

Timing
The CFO, or designee, will begin assembling the information needed to update the Official Statement as soon as reasonably practical when a bond issue is contemplated. If Disclosure Counsel is engaged, Disclosure Counsel will coordinate the preparation of the Official Statement with the financing team.

Auditor's Involvement
The District may include but is not required to include a review of its Official Statement in the contract for services with its independent external auditor. No consent of the independent external auditor shall be required for inclusion of the District’s audited financial statements in an Official Statement.

RATINGS
The District's goal is to establish and maintain a respectable bond rating. Accordingly, prudent financial management policies will be adhered to in all areas. Full disclosure of operations shall be made to the bond rating agencies. The District staff, with the assistance of the Financial Advisor and underwriter and others, will prepare the necessary materials for a presentation to the rating agencies. If requested by the District, Disclosure Counsel may review rating agency presentations for consistency with the Official Statement.

The District shall maintain lines of communication with the rating agencies (Standard and Poor's, Moody’s, et al.) informing them of major financial events in the District as they occur. The AFR shall be distributed to the rating agencies after it has been accepted by the Board.

For bond issues that are expected to be rated, the rating agency or rating agencies will be notified that a debt issue is being prepared. After the initial contact, a formal ratings application will be prepared and, along with any other requested documentation, sent to the rating agency. This application and related documentation should be sent as soon as possible within the expected financing timeline to permit the rating agencies sufficient time to perform their review.

A meeting or call with representatives of the rating agencies will be scheduled as needed upon the recommendations of the Financial Advisor or as determined by the CFO.

CREDIT ENHANCEMENTS
Credit enhancements are mechanisms that guarantee or support principal and interest payments. They include bond insurance or a letter of credit. A credit enhancement, while costly, may bring a lower interest rate on debt and a higher rating from the rating agencies, thus lowering overall borrowing costs.

During debt issuance planning, the Financial Advisor or the underwriter, as applicable, will advise the District whether a credit enhancement is cost effective under the circumstances. In a negotiated sale and if determined appropriate by the CFO, bids for credit enhancement will be taken during the period prior to the pricing date. In a competitive sale, bond insurance may be provided by the purchaser if the issue qualifies for bond insurance.

CONTINUING DISCLOSURE
The District is committed to compliance with its continuing disclosure undertakings. The District’s continuing disclosure obligations require annual provision of certain financial information and operating data to the Municipal Securities Rulemaking Board’s EMMA website, and filing of event notices for certain enumerated events within 10 business days after their occurrence. The CFO is the “Compliance Officer” for purposes of continuing disclosure compliance. At the direction of the CFO, the District may engage external counsel or another organization to assist with its annual filing obligations, or to assist from time to time with any event notices that may need to be filed.

TAX COMPLIANCE
It is the District's policy to minimize the cost of arbitrage rebate and yield restriction while strictly complying with the federal tax laws and regulations.

General
Federal tax laws and regulations are intended to discourage municipal entities such as the District from issuing tax-exempt obligations unnecessarily or too early. In compliance with the spirit of federal tax laws and regulations, the District will not issue obligations except for identifiable projects with very good prospects of timely initiation.

Responsibility
Because of the complexity of federal tax laws and regulations and the severity of noncompliance penalties, the advice of Bond Counsel or other qualified experts will be sought when questions about tax compliance arise. The CFO shall be responsible for promoting compliance with the District’s ongoing tax covenants and obligations, as set forth in the District’s tax compliance policy adopted August 9, 2012 and attached hereto as Exhibit A.

Internal Interim Financing; Reimbursement
In order to defer the issuance of obligations and reduce interest cost, when sufficient nonrestricted reserve funds are on hand, consideration shall be given to appropriating funds to provide interim financing for large construction contracts or parts of contracts. When the appropriations are subsequently refinanced with the proceeds of obligations or other resources, the nonrestricted reserve funds shall be repaid. When expenditures are reimbursed from the proceeds of tax-exempt bonds, applicable state law and Internal Revenue Service rules on reimbursement will be complied with so that the reimbursements may be considered permissible expenditures for federal tax purposes. In such connection, the District may ask Bond Counsel to prepare a resolution of the Board declaring its intent to reimburse itself from tax-exempt bond proceeds for expenditures made.

MODIFICATION TO POLICY
This policy and its provisions will be reviewed annually by the Board of Education Facilities and Finance Committee.

The Committee may approve minor changes of a housekeeping or corrective nature, or on advice of counsel, that conflict with federal or state laws or regulations. Significant policy changes will be presented to the Board for confirmation.

Legal Review – February 26, 2019

BOE Facilities and Finance Committee Review – February 26, 2019 Board Adoption – March 7, 2019

Policy Adopted:  02.11.2021 

.pdf version

Media Inquiries
Kelli Mayhew, Marketing & Communications
308-385-5900 ex. 201227
Grand Island Public Schools
123 South Webb Road
Grand Island, NE 68802
Your Legacy.
Their Opportunity.

Enhancing opportunities by seeking and securing resources for projects, scholarships and programs.

Access digital copies of our district flyers.

Improving school-to-home communication by distribute school flyers directly to families digitally.


PURPOSE
This Debt Policy sets forth a comprehensive guideline for the financing of capital expenditures by Grand Island Public Schools (District). The primary objectives of the policy are as follows;

  1. Establishing debt issuance practices for obtaining financing when needed
  2. Setting an efficient process for identifying the timing for and amount of debt or other financing
  3. Obtaining optimal interest rates, controlling other issuance costs and reducing risk where possible
  4. Conforming to all applicable state and federal laws and contractual obligations

USE OF DEBT FINANCING
Debt financing, to include general obligation bonds, certificates of participation, lease/purchase agreements, and other obligations permitted to be issued or incurred by school districts under Nebraska law, shall be used only to: purchase equipment, acquire real property, construct facility additions or renovations, or other similar improvements. The useful life of the asset or project shall exceed the maximum average life of any debt the District incurs in order to acquire the asset or project.

RESPONSIBILITY
The primary responsibility for developing financing recommendations rests with the Chief Financial Officer (CFO). No less than annually, the CFO, or designee, shall prepare for the Facilities and Finance Committee (or full Board of Education) a written report on the status of Capital Improvements Program (CIP) financing. The report shall include a projection of near-term financing needs compared with available resources, an analysis of the impact of contemplated financings on the Long-Range Financial Plan and the CIP, and financing recommendations. In developing financing recommendations, the CFO, or designee, shall consider the following:

  1. The expected spend time of bond or other proceeds, and any related carrying cost
  2. Options for interim financing, including near-term and interfund borrowing, taking into consideration federal tax reimbursement regulations
  3. Trends in interest rates
  4. Other factors as may be appropriate

INVOLVEMENT OF ADVISORS
The District recognizes the importance of engaging legal counsel and possibly other professionals in connection with complex financial matters. Accordingly, the District will engage counsel to represent the District in connection with most financings in order for the District to have proper representation.

Bond Counsel
Bond Counsel shall be selected by the District and engaged to represent the District, and shall be nationally recognized in matters of Nebraska municipal law and federal tax-exempt law. Bond Counsel will issue an opinion as to the validity and tax-exempt status of interest on all obligations issued as tax- exempt indebtedness. In coordination with the CFO, Bond Counsel will be responsible for preparing the Board resolution authorizing issuance of obligations; drafting any bond purchase agreement, installment contract or other operative instrument; drafting all of the documents required at closing; and providing other services as determined by the CFO.  In addition, the CFO, or designee, may seek the advice of Bond Counsel on other types of financings and from time to time on any other questions involving state law or federal tax law or regulations.

Disclosure Counsel
The District may engage Disclosure Counsel to assist the District with preparation of the Official Statement (as described below). Disclosure Counsel shall be nationally recognized in matters of federal municipal securities law. In coordination with the CFO, Disclosure Counsel will assist the District with drafting the Official Statement and coordinate disclosure due diligence matters.
The CFO, or designee, also may seek the advice of Disclosure Counsel from time to time on questions involving federal securities matters.

Financial Advisor
The District may engage a Financial Advisor if determined appropriate. The Financial Advisor will advise the District on the structuring of obligations to be issued, inform the District of various options, advise the District as to how certain choices will impact the marketability of the District’s obligations, and provide the District other services as determined by the Board of Education (Board). The District’s Financial Advisor shall meet the definition of a “municipal advisor” within the meaning of federal securities laws and shall accordingly owe the District a fiduciary duty.

SHORT-TERM DEBT

General
Short-term obligations may be issued to finance projects or portions of projects for which the District ultimately intends to issue long-term debt; i.e., it will be used to provide interim financing that eventually will be refunded with the proceeds of long-term obligations. Short-term obligations may be supported by a tax pledge, or a pledge of other available funds of the District as in each case may be permitted by Nebraska law.

Interim
Interim financing may be appropriate when long-term interest rates are expected to decline in the future. In addition, some forms of short-term obligations can be obtained more quickly than long-term obligations and, thus, can be used in emergencies until long-term financing can be obtained. In some cases when the amount of financing required in the immediate future is relatively small, it may be more cost-effective for the District to issue a small amount of short-term obligations to provide for its immediate needs than to issue a larger amount of long-term obligations to provide financing for both immediate and future needs when the carrying costs of issuing obligations that are not immediately needed are taken into account.

Cash Flow Borrowing
The District may incur short-term obligations if tax revenues are expected to result in a period where the District will experience a negative cash position in one or more of its funds. If possible, the conditions which necessitate any such borrowing should be corrected in order to avoid any such cash flow borrowings in the future.

LONG-TERM DEBT

General
Long-term obligations will not be used for operating purposes, and the life of the obligations will not exceed the useful life of the projects financed. Debt service structure will approximate level annual debt service unless it is determined appropriate by the Board to otherwise structure the amortization to fit with the amortization of other obligations outstanding or expected to be incurred. The District will strive to limit its annual issuance of long-term tax-exempt obligations to $10 million to take advantage of federal tax rules for bank-qualified debt. Should subsequent changes in federal tax law increase applicable bank-qualified limits, the District's policies will be adjusted accordingly.

The cost of taxable bonds is typically higher than for tax-exempt bonds. However, the issuance of taxable debt is necessary in certain instances that would allow the District valuable flexibility related to the use of a financed facility or covenant structures. Therefore, the District will typically issue tax- exempt obligations but may issue taxable obligations.

Bonds
Long-term general obligation bonds may be issued to finance significant capital improvements for purposes set forth by the Board when authorized by voters in a properly called election or as otherwise permitted under Nebraska law. Bonds will have a maximum average life of the lesser of (a) the average useful life of the facility being financed and (b) 25 years. Outstanding general obligation bonds of the District shall never exceed in the aggregate 5 percent of the assessed valuation of all taxable property in the District.

Call provisions for bond issues shall be made as short as possible, consistent with the lowest interest cost to the District, and as may be required by Nebraska law. When feasible, all bonds shall be callable at par.

Method of Sale
Debt obligations may be issued by either negotiated sale, competitive sale or privately placed directly with a purchaser. From time to time and at the sole direction of the District, but prior to issuing debt, the District will select an underwriter via a due diligence process to be utilized for negotiated sales. The District and the Financial Advisor, if applicable, will participate together in the selection of the underwriter. If the District determines to utilize a competitive sale process, the sale will be structured to ensure the most favorable bid for the District, upon the advice of the Financial Advisor, taking into account market conditions and other prevailing factors.

Sale Parameters
Parameters to be examined in connection with any bond issue may include the following:
·  Limits between lowest and highest coupons
·  Coupon requirements relative to the yield curve
·  Method of underwriter compensation
·  Use of true interest cost (TIC) versus net interest cost (NIC)
·  Use of bond insurance or other credit enhancement vs. a standalone individual bond rating
·  Permissible amount of original issue discount or premium
·  Call provisions 

REFUNDING
The District shall consider refunding debt whenever an analysis indicates the potential for minimum net present value savings of approximately 4 percent of the principal being refunded or at least $750,000. The District will not refund less than 5 percent of its outstanding debt at one time except in unusual circumstances, such as when it intends to change bond covenants or for other favorable business objectives.

CAPITAL LEASING
Capital leasing or lease/purchase agreements may be used for the acquisition of a capital asset with a cost of less than $2,000,000.

Whenever a lease is arranged with a private entity, a tax-exempt interest rate shall be sought. When a lease is arranged with a government or other tax-exempt entity, the interest rate should be taxable and the obligation should likewise not be subject to federal tax-exempt bond rules or regulations.

The lease agreement shall permit the District to refinance the lease at no more than reasonable cost should the District decide to do so. In assessing a lease arrangement, the District will consider call and acceleration provisions to achieve the most favorable approach.

Since the market for lease financings is relatively inefficient, the interest rates available at any one time may vary widely. Therefore, the District shall seek competitive proposals for any major lease financing. The net present value of competitive bids shall be compared, taking into account whether payments are in advance or in arrears and the frequency of payments. In addition, the District will consider the cost of lease financings compared with other financing potentials. If possible and cost-effective, the purchase price of equipment shall be bid competitively and separately from the financing cost.

The District's Bond Counsel shall be engaged to review any leasing arrangement proposed to be structured as tax-exempt, and may be engaged to review taxable leasing arrangements if determined appropriate by the CFO. The District may consider issuing certificates of participation to finance large projects.

OTHER TYPES OF FINANCINGS
From time to time, other types of financings may become available, such as debt pools with other entities and low-interest loans from state agencies. The CFO, or designee, will prepare a written analysis of such options. This report will include consideration of the legal advice of the District's Bond Counsel and, if applicable, the advice of the District’s Financial Advisor.

OFFICIAL STATEMENT
An Official Statement is the disclosure document prepared by the District for an offering of municipal securities in the aggregate amount of $1 million or more. It is used by the underwriter to market the District’s bonds, and typically describes the District, the financing plan, certain tax matters, and the security for the bonds or other obligations being offered pursuant to the Official Statement.

Responsibility
The preparation of the Official Statement is the responsibility of the District, but completion of the Official Statement will be managed by the CFO, with input from departments and divisions throughout the District as determined appropriate. The District’s counsel, Financial Advisor, or underwriter may provide additions or suggest changes to the District’s Official Statement. The District will participate in due diligence sessions with underwriters and counsel, and may consult with Disclosure Counsel on matters that may require disclosure in an Official Statement.

Timing
The CFO, or designee, will begin assembling the information needed to update the Official Statement as soon as reasonably practical when a bond issue is contemplated. If Disclosure Counsel is engaged, Disclosure Counsel will coordinate the preparation of the Official Statement with the financing team.

Auditor's Involvement
The District may include but is not required to include a review of its Official Statement in the contract for services with its independent external auditor. No consent of the independent external auditor shall be required for inclusion of the District’s audited financial statements in an Official Statement.

RATINGS
The District's goal is to establish and maintain a respectable bond rating. Accordingly, prudent financial management policies will be adhered to in all areas. Full disclosure of operations shall be made to the bond rating agencies. The District staff, with the assistance of the Financial Advisor and underwriter and others, will prepare the necessary materials for a presentation to the rating agencies. If requested by the District, Disclosure Counsel may review rating agency presentations for consistency with the Official Statement.

The District shall maintain lines of communication with the rating agencies (Standard and Poor's, Moody’s, et al.) informing them of major financial events in the District as they occur. The AFR shall be distributed to the rating agencies after it has been accepted by the Board.

For bond issues that are expected to be rated, the rating agency or rating agencies will be notified that a debt issue is being prepared. After the initial contact, a formal ratings application will be prepared and, along with any other requested documentation, sent to the rating agency. This application and related documentation should be sent as soon as possible within the expected financing timeline to permit the rating agencies sufficient time to perform their review.

A meeting or call with representatives of the rating agencies will be scheduled as needed upon the recommendations of the Financial Advisor or as determined by the CFO.

CREDIT ENHANCEMENTS
Credit enhancements are mechanisms that guarantee or support principal and interest payments. They include bond insurance or a letter of credit. A credit enhancement, while costly, may bring a lower interest rate on debt and a higher rating from the rating agencies, thus lowering overall borrowing costs.

During debt issuance planning, the Financial Advisor or the underwriter, as applicable, will advise the District whether a credit enhancement is cost effective under the circumstances. In a negotiated sale and if determined appropriate by the CFO, bids for credit enhancement will be taken during the period prior to the pricing date. In a competitive sale, bond insurance may be provided by the purchaser if the issue qualifies for bond insurance.

CONTINUING DISCLOSURE
The District is committed to compliance with its continuing disclosure undertakings. The District’s continuing disclosure obligations require annual provision of certain financial information and operating data to the Municipal Securities Rulemaking Board’s EMMA website, and filing of event notices for certain enumerated events within 10 business days after their occurrence. The CFO is the “Compliance Officer” for purposes of continuing disclosure compliance. At the direction of the CFO, the District may engage external counsel or another organization to assist with its annual filing obligations, or to assist from time to time with any event notices that may need to be filed.

TAX COMPLIANCE
It is the District's policy to minimize the cost of arbitrage rebate and yield restriction while strictly complying with the federal tax laws and regulations.

General
Federal tax laws and regulations are intended to discourage municipal entities such as the District from issuing tax-exempt obligations unnecessarily or too early. In compliance with the spirit of federal tax laws and regulations, the District will not issue obligations except for identifiable projects with very good prospects of timely initiation.

Responsibility
Because of the complexity of federal tax laws and regulations and the severity of noncompliance penalties, the advice of Bond Counsel or other qualified experts will be sought when questions about tax compliance arise. The CFO shall be responsible for promoting compliance with the District’s ongoing tax covenants and obligations, as set forth in the District’s tax compliance policy adopted August 9, 2012 and attached hereto as Exhibit A.

Internal Interim Financing; Reimbursement
In order to defer the issuance of obligations and reduce interest cost, when sufficient nonrestricted reserve funds are on hand, consideration shall be given to appropriating funds to provide interim financing for large construction contracts or parts of contracts. When the appropriations are subsequently refinanced with the proceeds of obligations or other resources, the nonrestricted reserve funds shall be repaid. When expenditures are reimbursed from the proceeds of tax-exempt bonds, applicable state law and Internal Revenue Service rules on reimbursement will be complied with so that the reimbursements may be considered permissible expenditures for federal tax purposes. In such connection, the District may ask Bond Counsel to prepare a resolution of the Board declaring its intent to reimburse itself from tax-exempt bond proceeds for expenditures made.

MODIFICATION TO POLICY
This policy and its provisions will be reviewed annually by the Board of Education Facilities and Finance Committee.

The Committee may approve minor changes of a housekeeping or corrective nature, or on advice of counsel, that conflict with federal or state laws or regulations. Significant policy changes will be presented to the Board for confirmation.

Legal Review – February 26, 2019

BOE Facilities and Finance Committee Review – February 26, 2019 Board Adoption – March 7, 2019

Policy Adopted:  02.11.2021 

.pdf version

Media Inquiries
Kelli Mayhew, Marketing & Communications
308-385-5900 ex. 201227
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