Low interest rate beneficial for new Jackson Heights bond

A lower-than-expected interest rate on the $5 million general obligation bond that Jackson Heights will use to fund construction of a pair of building additions in the district proved to be good news for the USD 335 Board of Education during the board’s regular monthly meeting on Monday evening at the high school.

During community meetings held prior to the November general election that included the district’s bond issue on the ballot, District Superintendent Jim Howard said he estimated an interest rate of about 5.1 percent on the $5 million bond, which was approved by district voters by a 466-141 margin in that election.

On Monday, Howard told the board the winning bidder at a bond sale held earlier that day — Hilltop Securities of Dallas, Texas — had proposed a 4.1-percent interest rate on the 25-year bond, which meant that the district could save up to $641,000 in interest payments over the life of the bond.

“Sometimes, you just get lucky,” Howard told the board, which noted that Hilltop and three other financial firms had proposed bond interest rates ranging from Hilltop’s 4.1-percent low to a high of 4.36 percent.

Bond counsel Kevin Cowan, representing Gilmore and Bell of Wichita, said following the sale of the bond, which was conducted with the services of Raymond James and Associates of Leawood, a closing on the bond is expected sometime later this month.

The funds will be used to build a new middle and high school building annex with six new classrooms and an elementary addition with a music room and two new classrooms, additions deemed necessary to accommodate the recent influx of students coming into the district from Wetmore after their school was ordered closed by the Prairie Hills USD 113 Board of Education in early 2023.

Cowan, who met with the board via telephone, told board members that during public meetings on the bond issue, a bond interest rate of 5.1 percent had been proposed with a total interest cost of $4,441,000 over the life of the bond. The rate as proposed by Hilltop would cut that total interest cost to $3.8 million, if the board were to take the full 25 years to pay it off.

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