RISD reaps $1 million benefit from 2006 ‘swap’ agreement

Local News

Discussion

February 23, 2010

By JIM HARDIN CNHI The Zope Gazette Tue Feb 23, 2010, 04:54 PM CST

ROCKWALL — By Jim Hardin

Herald-Banner Staff

The Rockwall Independent School District entered into a financial agreement in 2006 that has turned into a million-dollar benefit.

“I will tell you, this thing is working exactly as it was planned back four years ago and has done well,” Mike Singleton, the school district’s chief financial officer, told school board members Monday night.

“This is really good news,” he added. “We can cash in a million dollars and bring it in for our debt service fund and use that to keep our tax rates down and use for our finances.”

For the last several months, Singleton said, school officials have been evaluating tax rates on bonded debt and ways to handle financing for $65.7 million remaining from the 2006-2007 bond authorizations. He said officials looked at how the financing could affect the tax rate, noting that the school district’s property value had not increased as quickly as originally projected.

“So, we’ve been looking at all sorts of ways to proceed forward to do this financing and to do it with minimal amount of grief on our tax rates,” Singleton said. “So, one of the options we had resulted from something we put into place in 2006.”

The 2006 action was a “swap agreement.”

“That’s exactly what it’s called, where we swap an agreement with the bank in the way we calculated interest on that,” Singleton said.

“Initially,” he said later, “we had some negative aspects of that, but as the yield curve went up on interest rates, that turned out to our advantage.”

According to information provided to school board members, Rockwall ISD entered into a swap agreement on June 6, 2006, to reduce bond interests costs and take advantage of a potentially “steepening” yield curve. The school district exchanged monthly cash-flows with a bank, paying a fixed rate of 3.853 percent instead of the then-comperable fixed rate of 4.83 percent.

The resulting savings to RISD taxpayers — $5,585,000.

The swap was amended on July 1, 2006, to increase the advantage of a potentially “steepening” yield curve. This swap resulted in an additional interest cost savings of $222,000.

The school board also approved Teacher Retirement System of Texas TRS-ActiveCare as Rockwall ISD’s medical plan provider. This state health plan ensures about 92 percent of Texas’ school district, according to information provided at the meeting.

The school district’s cost will be lower, but the exact cost will not be known until later this year.

“I think this is kind of a paraphrase of what I understand after the discussions we’ve had,” said board member Chris Cuny.

“There’s always going to be confusion when you change a plan, the uncertainty. But my understanding is that we’re essentially providing the same health care benefits that we currently have. It’s going to be a lower cost, not only to the district, but hopefully to the employees who choose to cover their family.”

Text Only

Local News

Water restrictions likely to worsen
This past year was the driest 12-month period in Texas history. Although recent rains and cooler temperatures have offered some temporary relief, water supplies have been down and have not yet been replenished. The drought is predicted to continue through mid-summer. These projections make it critical that the region prepare for water shortages.

February 4, 2012
Mayor gives residents the ‘big vision’ during ‘State of Fate’ meeting
Mayor Bill Broderick’s message to about 70 residents during his annual “State of Fate” town hall meeting this week involved details of a “big vision” and his belief that within three years, they won’t know their town as they know it today.
Midway through his presentation, Broderick provided a summary of planned projects and developments.

February 3, 2012
Deputy saves women in daring rescue
The two young women who are alive today because of the heroic action of Rockwall County Sheriff’s Deputy Keven Rowan were on hand to make a presentation of their own Wednesday during a breakfast meeting of the North Texas Crime Commission.

February 2, 2012
Ratcliffe will not look to continue being mayor of Heath
Heath Mayor John Ratcliffe announced that he will not seek re-election after his fourth term ends in May.

February 1, 2012
Elm Street becomes war zone for movie filming
There were some light moments in the war zone on Royse City’s Elm Street Saturday morning.

January 30, 2012 1 Photo
Court looks at justice integration
The commissioners, after taking a week off from their typical workshop session, came back in force discussing items such as the integration of county justice system software and whether to spend more money on construction at the new courthouse.

January 29, 2012
Hall remarks on president’s address
Congressman Ralph Hall responded this week to the president’s State of the Union address with scorn.
“Tonight, President Obama laid out his blueprint for rebuilding the economy - but unfortunately the current state of our nation is in large part due to his failed economic and over-reaching regulatory policies. The unemployment rate has remained at or above 8 percent for 35 months and our deficits have more than doubled,” he said. “The president’s record speaks for itself, and it has been a failure.”

January 28, 2012
Iconic burgers
There are many things that define Rockwall. The Harbor, the Square and the lake are all icons of this county. On par with the big three is, a burger joint. This may seem shocking to some, but Boots Burgers has been around since 1968 and for 40-plus years people from all over Texas have trekked to the house style restaurant for a classic taste.

January 27, 2012 2 Photos
City of Heath Sanitary Sewer Line Overflow
Heavy rains forced two sanitary sewer overflows in Heath discharging into Lake Ray Hubbard on Jan. 25.
The overflows were caused by rainwater entering sanitary sewer pipes through cracks in the city’s lines or through cracks in private plumbing lines. The sewer mains are not designed to carry rainwater that overloads the pipe’s capacity to carry wastewater to the treatment plant.

January 26, 2012
Manager arrested for recording changing employee
On Jan. 21, 2012 at approximately 1:44 p.m., The Rockwall Police Department received a call about a possible criminal offense of Improper Visual Recording at PaPa Murphy’s located in the 2400 Block of Ridge Road.

January 25, 2012
More Local News Headlines

Local News

Search Results

Discussion

RISD reaps $1 million benefit from 2006 ‘swap’ agreement

Will you vote in the County elections?

Site Map

Contact Us