Finance & Audit Committee Meeting/Notes June 13, 2019

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State college Area School District

Our Mission:  To prepare students for lifelong success through excellence in education.


June 13, 2019 Finance and Audit Committee Meeting

9:00 a.m. Meeting Room A

Panorama Village Administrative Center

240 Villa Crest Drive

State College, Pa   16801


   I.     Call to Order


 II.     Capital Financing (attachment)


III.     SCASD Education Foundation Financial Statements and Draft M&G 2019 Projection (attachment)


 IV.     Sponsorships


  V.     Public Comment  


 VI.     Adjournment 

 Accepted Notes
June 13, 2019 Board Finance and Audit Committee Meeting Minutes
Meeting Room A – 9:00 a.m.
Panorama Village Administrative Center
240 Villa Crest Drive
State College, PA 16801

Present: Amber Concepcion, Scott Fozard (9:20 a.m.), Jim Leous, Laurel Zydney
Loren Crispell, Bob O’Donnell, Nancy Reese, Donna Watson
Guests: Tom Beckett

A copy of all materials distributed to the committee members for discussion are included with the official minutes, unless otherwise indicated.

I.     Call to Order
Ms. Concepcion called the Finance and Audit Committee meeting to order at 9:09 a.m. the meeting was turned over to Dr. O’Donnell.

II.    Capital Financing
Dr. O’Donnell stated that the committee would be reviewing the Capital Financing Plan that would go through the next fiscal year focusing on finishing the three (3) current planned playgrounds, Elementary and High School projects and Memorial Field. The summer and into the fall of 2020 the District would be taking steps to develop a detailed strategic capital plan to ensure that funds are available to maintain our buildings; stating that planning would begin in 2021 for the remaining playgrounds. Dr. O’Donnell turned the Capital Financing discussion over to Donna Watson and Tom Beckett of NW Financial.

Ms. Watson gave a brief overview of the financing options for Memorial Field which includes bank loans with 10 and 15 year options and bond financing with 15, 20 and 25 year term options. NW Financial provided bond financing options for $10 million of the State High Project, allowing for capital reserve to be used for the athletic/recreation facilities and taking advantage of favorable interest rates and eliminating added fixed costs of borrowing projected in 2020-21. Mr. Beckett gave a detailed explanation of the District’s 2012 and 2013 bonds available for refunding this year, discussed two-phase loan scenarios and refunding bonds. The current market is showing that bonds are a better option vs. bank loans; saving the district interest cost by financing the proposed improvements with a single bond. The refunding could be combined with Memorial Field financing. The estimated savings for refunding the current bonds is approximately $370,000, or 2.86%, if a stand-alone refunding issue. If combined with a new borrowing, the savings would increase by approximately $50,000. Page 14 includes a possible change in the funding of the final $10 million for the State High projection and for the athletic/recreation facilities. Version 1 (page 13) includes funding of three playgrounds as part of Memorial Field borrowing, funding some North and South Field capital expenditures from the Capital Reserve and borrowing the remaining in 2020-21. Version 2 (page 14) assumes all athletic/recreation facilities, except three playgrounds will be funded from the Capital Reserve fund. This would also include financing the final $10 million of the State High project.

Mr. Beckett noted that the savings are due to lower interest rates and eliminating future finance fees by eliminating a potential borrowing for Athletic/recreation facilities in 2020-21. Discussion and questions followed. The Finance Committee was in favor of presenting version 2 over a 25 year period to the full board for approval.

III.    SCASD Education Foundation Financial Statements and Draft M&G 2019 Projection The committee reviewed the April financial statements and M&G projections. Mr. Fozard mentioned that the Finance and Audit committee would have monthly financials to review going forward. Dr. O’Donnell pointed out that the financials presented did not include the $100,000 Memorial Field pledge that was received in June, noting that the financials being reviewed were for April.

IV.    Sponsorships
Dr. O’Donnell and Loren Crispell gave a brief overview of two organizations that are interested in advertising at SCASD athletic events. One advertisement would be on the North Field Scoreboard and the second would be a banner promoting Bright Futures at nine (9) Middle School athletic events a year. The North Field Scoreboard would be a 10 year agreement and the banner at Middle School athletic events would be a 3 year agreement. Discussion and suggestions on contract wording followed. Mr. Crispell will be working with the two interested organizations and when the agreements are finalized they will be brought to the board for review and approval.

V.     Public Comment
There was no public comment.

VI.    Adjournment
Mr. Fozard adjourned the Board Finance and Audit Committee meeting at 11:06 a.m.

Submitted by,

Nancy Reese