The Watertown-Mayer School board on Monday, Aug. 27, approved the refunding of the district’s 2005 school building bonds, a measure that will save the district and its taxpayers $2.4 million over the life of the bonds.
The board had previously approved at a July meeting the sale and issue of approximately $27,150,000 of general obligation refunding bonds in an effort to obtain a lower interest rate. Last Monday’s action by the School Board was to approve the sale of the bonds to Raymond James Financial, the lowest bidder among 10 total bids earlier in the day.
The new bonds carry an interest rate of 2.12 percent, much lower than the 4.6 percent rate on the old bonds. Though the lower rate will save the district nearly $2.5 million over the life of the bonds, savings won’t be seen until 2016 due to the crossover nature of the refunding.
A representative of Springsted, Inc., the district’s independent financial advisor, told the School Board that annual savings will range from roughly $190,000 to $250,000. The savings will specifically be seen in the debt service levy that is approved on a yearly basis to collect taxes from local residents to pay the bonds.
The Springsted representative said the district received numerous competitive bids for a number of reasons. She said that the district’s financials as a whole are very good, and that investors are looking for districts that can maintain their debt and have a good credit rating.
In other business
• The School Board approved a measure that will reduce pay for long-term substitute teachers that are formally employed Watertown-Mayer teachers or staff. The change will most significantly effect recently retired teachers, who often return in the years immediately following their retirement as substitutes for teachers with long-term absences.
Under the old policy, long term subs that were formerly employed Watertown-Mayer teachers were paid at the same rate as when they retired, up to Step 18. The new policy will allow for formerly employed long-term subs to be paid at Step 6.
The change was made because recently retired teachers that were serving as long-term subs were costing the district between $500 and $600 a day, according to Superintendent Dave Marlette. Of that amount, the substitute teacher actually received about $300. The normal rate for a substitute teacher in the Watertown-Mayer district is $110 per day, though the pay increases to the Step 6 level after 15 days.
Marlette indicated that the savings with the new policy could be as much as $7,000 in the first 15 days of a long-term substitute teacher’s duty, and often far more than that because a typical length of duty ranges from 30 to 45 days, he said.
However, the board wrestled with the proposal out of concern that recently retired teachers would be less likely to take on such roles for the much lower pay rate. The consensus on the board was that it was far preferable to have retired teachers in those roles because they know the school, the policies and systems already, and can step right in without skipping a beat.
Ultimately, however, all but one board member voted in favor of the proposal. Jennifer Janikula was lone dissenting vote, arguing that she has seen first hand in one of her child’s classes how valuable a retired teacher can be in taking over a classroom mid year, and she didn’t want them to be dissuaded from taking on such roles in the future.
• The Board approved the bid from the Ryan Company to provide Fulton Boilers for the High School Boiler Replacement Project. The bit amount was $106,800, which includes materials only with no installation or control packages. The board previously approved $160,000 for the entire cost of replacement. KFI, the engineering company that designed the system, is working to negotiate the installation costs.
• The School Board approved the Watertown-Mayer Activities Director Master Agreement for the next two years. As with all other contracts that have been approved, it included a pay freeze for the upcoming school year and a 3 percent raise for the 2013-14 school year.
• The School Board approved the 2012-13 handbooks for the high school, middle school, elementary school and primary school, as well as the Parent –Student iPad handbook. All the handbooks are viewable at the school district’s Web site, www.wm.k12.mn.us.