Olentangy Local School District and Baird Announce $50M Bond Offering

Use of Build America Bonds Provides Lower Financing Costs to District

The Olentangy Local School District and Baird announced the completion of $48.9 million bond issue. The district becomes the first Ohio School district to utilize provisions of the American Recovery and Reinvestment Act of 2009 to issue Build America Bonds. Such bonds carry a lower interest rate than traditional bonds. Baird, an employee-owned, international wealth management, capital markets, private equity and asset management firm, served as the managing underwriter on the transaction.

$34.5 million of the proceeds from the offering will be used for capital improvement projects, such as constructing and furnishing Cheshire Elementary School, scheduled to open for the 2010-11 school year, and Olentangy Berkshire Middle School, scheduled to open for the 2011-12 school year. Other improvements include energy-efficient upgrades for several of the existing schools, as well as the purchase of additional school buses, new textbooks and technology needs.

By issuing the Build America Bonds, the district will pay a 4.03% interest rate compared to a 4.84% traditional tax-exempt rate available. Over the life of the bonds, which have a maturity of twenty-eight years, the district is positioned to save approximately $3.5 million in today’s dollars.

“Olentangy’s mission is ‘to facilitate maximum learning for every student’ and we are dedicated to doing this in a cost-efficient manner,” said Superintendent Wade Lucas, Ed.D. “By using this financing package, we are able to make our mission a reality while also honoring our commitment to local taxpayers of responsible fiscal management.”

“The stimulus plan has allowed Olentangy to continue to keep our promise of issuing no more than .82 mills as part of the March 2008 ballot issue, keeping our total bond millage at 8.72. This pledge is very important to the Olentangy Local Schools Board of Education,” said Treasurer Rebecca Jenkins.

According to two leading rating agencies, Standard and Poor’s and Moody’s Investor Services, the District received an AA+ and Aa2 credit rating, respectively. The district’s strong rating and good fiscal management contributed to the success of the offering.

“Baird is pleased to help the Olentangy Local School District complete this bond offering and access lower cost financing through Build America Bonds,” said Jenni Logan, Director in Baird’s Public Finance group and lead banker on the deal. “The offering will allow the District to move forward with its much needed school improvements as well as save taxpayer dollars.”

Added Brad Sprague of PRISM Municipal Advisors, Financial Advisor to the District, “Over the past several years, District leadership has made sound and prudent financial decisions on a consistent basis. That wise approach has enabled them to access this special financing and make investments that benefit local students.”

Under the American Recovery and Reinvestment Act of 2009, states and local governments are eligible to issue BABs, through 2010, for capital projects. When issuing BABs the issuer typically receives a subsidy from the federal government equal to 35% of the interest. In many cases, this subsidy results in lower borrowing costs to the issuer, thereby reducing its overall borrowing costs.

About Olentangy Local School District
The Olentangy Local School District consists of 10 municipalities and provides educational services for more than 15,000 students in grades preschool through 12. The district operates 13 elementary schools (one that opened for the 2009-10 school year), four middle schools and three high schools. The district offers a comprehensive and advanced curriculum and a wide selection of extracurricular activities at all levels. Olentangy’s mission is “to facilitate maximum learning for every student” and its vision is “for students to perform at a level that surpasses or is equal to their anticipated level of achievement based on measured ability. Olentangy will promote high expectations for students in all areas: academic, artistic, physical, health, citizenship and service.” For the sixth year in a row, Olentangy earned the state's highest rating possible (Excellent with Distinction) on the Ohio Department of Education’s local report card.

About Baird
Baird is an employee-owned, international wealth management, capital markets, private equity and asset management firm with offices in the United States, Europe and Asia. Established in 1919, Baird has more than 2,400 associates serving the needs of individual, corporate, institutional and municipal clients. Baird oversees and manages client assets of more than $66 billion. Committed to being a great place to work, Baird ranked number 14 on the FORTUNE’s “100 Best Companies to Work For” in 2009 -- its sixth consecutive year on the list. Baird’s principal operating subsidiaries are Robert W. Baird & Co. in the United States and Robert W. Baird Group Ltd. in Europe. Baird also has an operating subsidiary in Asia supporting Baird’s private equity operations. For more information, please visit Baird’s Web site at www.rwbaird.com.