Missouri Schools Must Comply With COVID Decision To Obtain Treasurer’s Approval Of Bond Agreements • Missouri Independent


If school districts want to take advantage of a lower interest rate on bonds, Missouri Treasurer Scott Fitzpatrick is asking them to certify compliance with a recent court ruling targeting local health ordinances before his office does approves the agreement.

Fitzpatrick detailed the decision he called “unprecedented” in an interview on Wednesday with Missourinet.

Two school principals who received state instruction on Thursday said the change was highly unusual. But each said they agreed to the terms to ensure that higher costs were not passed on to taxpayers in their communities.

“It’s a little hard to reconcile how the two things go together, but I was taken by surprise Monday when I received the form,” said Karl Matt, superintendent of North Platte School District R-1.

The change appears to be another way school districts are under pressure to comply with a recent court ruling. that Attorney General Eric Schmitt tried to enforce.

On November 22, Cole County Circuit Court Judge Daniel Green ruled on some state regulations delegating powers to public health officials. violated the Missouri Constitution, and therefore, all health orders issued unilaterally under them were declared “null and void”.

Mary Compton, spokesperson for the treasurer’s office, noted that school districts’ participation in the bond direct deposit program is voluntary and said Fitzpatrick has discretion over whether or not to approve financial transactions.

“Due diligence is always performed in preparation for a financial transaction and the disclosure of pending or threatened investigations or litigation is an important consideration when deciding whether to enter into a financial transaction with a party.” , said Compton.

According to a copy of the certification agreement obtained by The Independent, superintendents were asked to certify that their district was in compliance with Schmitt directives sent on December 7 or that the district would become compliant no later than December 23 – the day after the court’s decision becomes final under the rules governing civil cases.

For decades, the Missouri Health and Educational Facilities Authority (MOHEFA) has entered into funding agreements with school districts to pay off debt. By agreeing to set aside some of its state aid, a district may receive a lower interest rate than it might otherwise get.

However, Fitzpatrick told Missourinet that in the future that will change. School districts will need to certify that they will comply with Green’s decision in order to receive approval from the treasurer’s office on the agreement.

“If they want our approval before the scheduled closing time, we have to have that certification in hand,” Fitzpatrick told the Missourinet.

If the districts do not certify their compliance, the conclusion of the agreement would be delayed, he said, and they could have to rely on their own credit to borrow funds, which would likely result in a higher interest rate. .

Compton said Thursday that six school districts had been asked to sign the certification, four doing so and two pending.

It is a difficult place. We are a small community and the potential to save around a million dollars for taxpayers is huge, but you also need to find a balance with finding what is in the best interest of your students’ safety – that safety. of your students is worth more than a million dollars. I think that’s kind of the way things are going anyway.

– Karl Matt, North Platte R-1 School District Superintendent

Gregg Klinginsmith, the Warren County R-III school district superintendent, said refinancing past debt would save the district about $ 762,000. The North Platte R-1 school district would save just over $ 972,000, Matt said. The North Platte District closed on Wednesday with a $ 6 million bond issue refinancing past debt.

The two superintendents said they received the certification form a few days before their expected trade close date and signed them this week.

Erica Chandler, spokesperson for Affton School District, confirmed that the district received the certification form on Monday and is currently exploring the potential impacts it will have on her district.

Failure to do the bond deal would have meant having to consider raising tax rates to pay for future projects or delaying projects, Matt said.

“It’s a tough place. We’re a small community and the chance of saving taxpayers about a million dollars is great, “said Matt,” but you also need to balance that with finding what is in the best interests of your students’ safety – which security of your students is worth over a million dollars. I think that’s kind of the way things are going anyway.

If his district was unable to consolidate debt at the lower interest rate, Klinginsmith said he would have lost expected savings and taxes would stay at current levels. This, he said, “would almost represent a tax increase for our local taxpayers if we are not able to refinance.”

Over the past week, a growing number of school boards have voted to allow the expiration of mitigation measures, such as mask requirements. Others rebuffed Schmitt’s demands, citing both local and state laws they say allow their health measures.

Matt and Klinginsmith said their two health departments have stopped issuing quarantine notices following Green’s decision. The North Platte R-1 School Board is expected to adjust the district’s security plan on Thursday evening, and the district is unlikely to identify close contacts after that, Matt said.

The Warren County R-III School Board already voted last week to drop the district’s quarantine rules and mitigation strategies, Klinginsmith said, bringing the district into line with the attorney general’s directive.

Klinginsmith said he could see how the new requirement might pose a problem for other districts trying to follow the guidelines of their health departments, and expressed concern if other metrics, such as skill levels or test results, could be used in the future as an obligation to allow districts to refinance their bonds.

“It definitely seems to cross some sort of line,” Klinginsmith said. “But we’re just following the rules that are sent to us, and we’re happy to be able to refinance.”

Fitzpatrick cited the possibility of future litigation by Schmitt as one reason that factored in his decision, in addition to wanting to make sure schools comply with the law.

“To us, it doesn’t make sense for the state to enter into an agreement allowing a district to graft onto our credit rating, if at the same time it is about to be sued by the state for not s ‘comply with a court order and what the Attorney General interpreted to be the law.

“And that’s how it comes down to it. It has to do with the risk that the district might get involved in a dispute with the state, while at the same time seeking to use state credit to borrow money. money, ”Fitzpatrick said.

When asked if critics could view the move as a politicization of a routine process, auditor candidate Fitzpatrick told Missourinet he was not making the decision public.

“You called me. It’s not like I’m out there banging my chest in the press about it,” he told Missourinet. “It’s something that we’re doing it because we think it’s the right thing to do and it’s the financially prudent thing to do. “

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With Fitzpatrick’s signature, funding agreements must be approved by MOHEFA and the Department of National Education.

It is not known whether MOHEFA approves the change. MOHEFA Executive Director Michael Stanard did not immediately respond to requests for comment.

Officials from MOHEFA and the Department of Primary and Secondary Education (DESE) received a copy of an email sent by the treasurer’s office notifying a district of the certification form, according to an email obtained by The Independent. .

DESE spokesperson Mallory McGowin said the department had no prior knowledge that the treasurer’s office was adding the certification form to the standard funding agreement documentation.

Compton said Fitzpatrick’s fiduciary responsibility is separate from MOHEFA’s responsibilities to the program and that he does not need any authorization from any other party to require certification.

Fitzpatrick told the Missourinet that he received advice from the attorney general’s office and his office’s attorney, and said he had discretion as to whether or not to sign the agreements.

“It’s up to my discretion as state treasurer to do it or not,” Fitzpatrick told the Missourinet.

Chris Nuelle, a spokesperson for Schmitt, said the attorney general’s office was grateful to see that Fitzpatrick felt the same about making sure districts are in compliance and was “happy to have Treasurer Fitzpatrick with us in this important fight “.

The effects of last month’s court ruling continued to reverberate across the state with more than a dozen local health services are shutting down some aspect of their work to monitor and mitigate the spread of the coronavirus, citing a lack of guidance from the state’s health department.

Warning of the potential to hamper their ability to respond to all contagious diseases more broadly, Jackson and St. Louis counties and a local public health service, asked to intervene in the case and to appeal the decision.

Meanwhile, the South Nodaway R-IV and Polo R-VII school districts completed their fall semesters at the start of this week faced with a large number of sick students and staff.

Wednesday, St. Louis County Public Health Department released analysis which found, for the week ending Dec. 4, self-reported COVID-19 cases among school staff peaked at 95 – a 70% increase from the previous record of 56 staff cases.

For that same week, there were 402 reported cases among college students, the second-highest amount in a week, and 551 pediatric COVID cases diagnosed in the county – more than any week since November 2020, said the health department.

As transmission at school declined, 1,514 staff and students were reported to be quarantined due to school-related exposure – the highest figure since start October, according to the analysis.

This story has been updated since it was first posted.



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