Trinity district sells $4.6M in bonds to meet debt payment
Trinity Area School District Monday received $4.6 million from the sale of bonds that will be used for its upcoming debt payment.
The school board last month approved the issuance of up to $8.6 worth of general obligation bonds to be used to pay for debt incurred from construction and renovation projects.
The maneuver will help the school district as it works through its financial challenges.
David Roussos, director of fiscal services, said proceeds from the bond sale will be used to make a Nov. 1 payment on the district’s debt.
Among the district’s expenditures is a nearly $6 million debt payment that it must make annually.
The bond issuance was necessary to enable the school district to operate and remain in the black, and it helped boost the district’s low fund balance, said Roussos.
As of June 30, 2013, the school district was $2,094,778 over budget, in addition to a budgeted deficit of $937,626, which resulted in total net change in the fund balance of $3,032,404.
The district restructured its debt because about 13 percent of its budget was going toward debt service.
“We’re borrowing money to make that November payment to continue to go forward,” said Roussos. “There are gaps between expenditures and revenues. Those gaps are significant enough that trying to close it all in one year would be irresponsible because of the impact it would have on kids and the district. We have to bring expenditures and revenues in line with each other, but we can’t do it in a year. The long-term plan is, through increasing revenues and decreasing expenditures, to get those two numbers back in line.”