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Rock Creek USD 323

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Rock Creek USD 323 Schedules Sale of Bonds

The Board of Education of Rock Creek USD 323 took another step toward the bond projects approved by voters at an election last November.

 

At a meeting of the Board of Education in late January, the Board approved a resolution scheduling a competitive bid sale of the approved bonds.   The District will accept bids from potential Underwriters until 11:00 AM on Wednesday, March 14th.

 

The bidders are usually broker-dealers or broker-dealer banks that must agree to purchase the entire $30.63 million in bonds and then remarket bonds to long term investors.  The bidder also could be a syndicate of multiple firms working together to remarket the bonds.   The bid providing the lowest True Interest Cost to USD 323 will be awarded the bonds if their bid is deemed to be accurate and meeting bid specifications. 

 

The bonds are popular investments for institutional buyers and individuals as the interest paid is exempt from both federal and State of Kansas income taxes—tax exempt.  The General Obligation Bonds are secured by the full faith and credit of the 323 District with a pledge to levy and collect taxes to meet the debt service on the bonds.

 

The bonds will be offered in denominations of $5,000 or multiplies thereof.  The bonds will have maturities ranging from 2020 to 2042.   Usually, the longer the maturity, the higher yield offered to investors.   The District is submitting the issue to Standard and Poors for a credit rating on the bonds.  The bonds may also be additionally secured by municipal bond insurance at the option of the successful bidder.

 

Individuals wanting to purchase bonds for investment should be able to do so according to the District’s financial advisor, Bret Shogren of George K. Baum and Company in Wichita.    In most cases, the bonds are purchased by a firm or syndicate of firms that will offer the bonds to investors.  Baum indicated that the bonds may sell quickly after bids and pricing.

 

Local individuals interested in possible purchase are encouraged to contact either George K. Baum in Wichita (1-800-345-2363) or the District office to express their interest.  When the bond purchaser is determined the morning of March 14thh, Baum will notify interested investors as to who to contact to get pricing information of the bonds.     As a financial advisor to the District, Baum is not allowed under SEC rules to bid on the bonds to avoid any potential conflict of interest. 

 

Although the bonds will be sold on or about March 14th, purchasers will not have to pay for their bonds until a closing on or about March 29th.