Working Cash Bonds/Property Sales

At the Dec. 6 meeting, the D-26 board discussed the working cash bonds with Eric Anderson, BMO Capital Markets and Erin Bartholomew, Chapman and Cutler LLP, but the potential sale of the Maplewood and Oak Knoll (Currently leased by Trinity Oaks Christian Academy) properties may have affect on the bond sales.

While trying to sale working cash bonds, the influx of cash from school property sales and transactions that include bonds, may lead to more procedures the district has to take with the state, according to Anderson and Bartholomy. 

The district has been consisted with reporting all of their proper numbers on a monthly basis and the board said they want to stay that way, so they will not be penalized by the state, as it relates to property/bond sales.   

Anderson presented information that stated the working cash bonds could be issued as primarily tax-exempt, with about 11 percent of the borrowing designated as taxable.  Potential target dates for the sale of the bonds are around the second or third week of January.

Bartholomy spoke about the legality of bond sales, which was a 22-page report.

The projected deficit in May of 2011 is $13.49 million. Under the law the district may issue $13.4 million tax-exempt in working cash fund bonds.

The board will discuss the bond sale parameter resolution at tonight's meeting.

Maplewood Bid/Oak Knoll Property

The Cary Park District put in a bid of $510,000 for Maplewood but it's the Administration's recommendation that the bid be rejected. The board will officially vote on the bid tonight.

Along with Maplewood, the Oak Knoll property is also up for discussion to sale but the Administration has recommended the district to keep Oak Knoll property and it's current leasing provisions.

However, depending on the buyer of these properties, there may be an on-going revenue stream in the form of property tax proceeds.

But the Maplewood and Oak Knoll properties may have a set of bonds that need to be paid off if sold and if the buildings are demolished, the district has to find out if the land itself has bonds tied to it, which the district is already conducting research on the history of these facilities.

In the district's property update memo, "According to Chapman and Cutler, all outstanding bonded indebtedness attributable to any property being sold for a use other than that which was specifically stated in the bond issuance statement, must be repaid in full from proceeds of the property sale."

The board will meet at Cary Jr. High School, 2109 Crystal Lake Road at 7 p.m.