The Fayette County Board of Education last week adopted a resolution that provides for the public offering of the school system’s 1999 bond for which nearly $25 million is owed. The action was required prior to the June 11 county commission meeting. The decision to go public came after the banks that had been approached had strings attached to their refinancing proposals.

The school board in April approved Morgan Keegan & Company as the financial advisor for the refinancing with the idea of saving approximately $1 million in interest charges.

Comptroller Laura previously reported that she had been told by Morgan Keegan representatives that the banks approached to handle the refinancing had strings attached that would have required the school system to move their accounts to those banks.

Brock advised against that move, suggesting instead that the board approve a refinance through a public offering.

The move to have a public offering of the bonds required that a board resolution be signed before the June 11 county commission meeting since the commission had to approve the measure.

In mid-April, school system Audits & Financial Reporting Coordinator Tom Gray said the school system owed $24.9 million on the original $56 million bond series from 1999, which was a re-funding of the 1994 bond. The remaining amount is callable, he said, and the school system wanted to see if the market might produce a lower interest rate.

The system has a total of five bond series in place, totaling approximately $180 million. The bond series from 1999, 2001, 2002, 2005, 2007 and a capital lease financial instrument have been used largely for the construction of new schools, the renovation of existing schools and for technology.