School Board Defers Borrowing Decision, Elects Officers

Given the body was short one board member, the San Marino Unified School District board elected to wait a month to decide on what terms it will try to borrow $8 million for its forthcoming athletic complex.
The board did, however, elect new officers for 2017 in its final meeting for 2016.
The Certificate of Participation, as presented by Chet Wang of El Segundo-based Keygent Advisors, would be for $8 million over a 25-year period with varying interest rates based on early payment schedules. The payments would run through 2041 unless the School Board acts upon an early payment contingency.
“This is a lot to digest,” said Superintendent Dr. Alex Cherniss at the Dec. 13 meeting. “Given that we don’t have one of our board members here tonight, I would suggest deferring a decision to the next meeting.”
Chris Norgaard did not attend that meeting.
The three scenarios presented to the School Board were for 10-year, five-year and two-year early payments. The 10-year early option had a 4.28% interest rate. Five years had a 4.46% interest rate. Two years had a 4.8% interest rate.
Interest rates rise in shorter windows to ensure some profitability for the lending parties in the event the School District did pay off its debt early.
In the event the School Board takes the full 25 years to pay off the loan, it would represent a total of $13.29 million for the 10-year scenario, $13.53 million for the five-year scenario and $14.02 million for the two-year scenario.
Wang noted that interest rates, although beginning to move higher following the “surprise results of the presidential election,” remained near historical lows. He said he didn’t expect them to change substantially by the time of the next meeting.
The project for which the loans are being considered, the Barth Athletic Complex at Huntington Middle School, is expected to break ground next year and will replace the current facility that bridges the lot from the School Board office and HMS. The project also has seen significant donations for specific areas in the complex and will be named in recognition of the donors.
In other business, Board Member C. Joseph Chang will serve as the 2017 board president, with Shelley Ryan and Lisa Link joining as vice president and clerk, respectively.