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BOE holds PSS bond closing meeting • Financing firm says money for CIP projects available on Thursday
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Posted on May 26 1999
The Board of Education yesterday convened a bond closing meeting with its financial advisers and officials were informed that the $15.6 million will be available by Thursday.
According to Michael Ogburn of the California Financial Services, after the bond closing in Thursday, CNMI time, money will be transferred to the trustee bank of the Public School System.
The Bank of Hawaii will acknowledge receipt of the transfer of funds hopefully on the same day with the closing date.
Ogburn and colleagues arrived on Saipan over the weekend to seal the Bond Purchase Agreement with Gov. Pedro P. Tenorio, BOE Chairman Esther Fleming and Commonwealth Development Authority Chairman John Tenorio.
Both the California Financial Services and underwriter firm Pain and Webber informed the Board that the legislative move to identify revenues generated from the local fuel tax for loan repayment facilitated the process.
“The liquid fuel tax was extremely helpful. It enabled us to have a more secure transaction and earned us the triple A rating,” Ogburn said.
Rep. Karl T. Reyes introduced the PSS bill and identified the revenues generated from the local fuel tax as the source for the loan repayment. It authorizes the Secretary of Finance to transfer $2 million from the fuel tax revenue to a special account each fiscal year.
This assurance for repayment also secured the PSS bond with a 3.96 interest rate.
Following this bond transaction, Ogburn told the Board that PSS will need to treat the $15.6 million as CNMI money. Like local procedure for contract bidding and other procurement requirements will be followed.
Another $15.6 million will come from the 702 funding to raise around $30 million for the PSS projects for the three islands. Both Tinian and Rota will receive $3.5 million each.
Saipan’s $23 million share will see a new high school and junior high school. Both projects are estimated to cost over $17 million, and the remaining money will be used to build a school in Anatahan and other renovation projects on Saipan.
