SHARON SCHOOLS District approves refinancing deal

Rising bond-market interest rates have reduced the expected savings.
By HAROLD GWIN
VINDICATOR SHARON BUREAU
SHARON, Pa. -- Sharon City School District could save about $230,000 in interest costs by refinancing a pair of bond issues made to pay for building renovations.
The school board voted Monday to use RBC Dain Rauscher of Pittsburgh as its bond underwriter and Thorp, Reed and Armstrong of Pittsburgh as its bond counsel for the refinancing.
The district will refinance $9,250,000 to replace 1998 and 1999 loans.
James Wolf, district business manager, first proposed the refinancing last month, saying at the time that Sharon could save $418,000 because interest rates in the bond market were low.
He also warned that rates were starting to rise again and that the savings estimate might not hold for long.
It didn't, as Wolf told the board Monday that the revised savings estimate is down to $230,000.
Bidding the work
The board didn't act on the refinancing last month because President Melvin Bandzak wanted to get other proposals on the underwriting work, suggesting that Sharon might get a better deal through competitive bidding.
Wolf said three banking institutions made presentations to the district last week but none were comparable to RBC Dain Rauscher, which has been the district's bond underwriter since 1998.
The company fee will be 6.5 percent of the $9,250,000 bond issue, Wolf said.
Thorp, Reed and Armstrong will be paid a flat fee for their service, but that amount wasn't immediately available.
Personnel matters
In other business, the board gave its approval to new contracts for administrators and confidential employees (workers who deal with confidential information). Full details won't be released until the contracts are signed, but school officials said both are for three years.
Administrators will get 2.5 percent raises in the first year and 3 percent in each of the next two years; confidential employees will get 3.5 percent raises each year.
There were some health-benefit concessions from employees, and administrators will begin paying some of their health-care insurance costs beginning in December.