Transaction Details

Navarro Independent School District

Municipal

Lead Bookrunner

Navarro Independent School District (the “District”), located in Guadalupe County, serves approximately 2,400 students across four campuses and is recognized for strong academic performance and community-focused values. With a graduation rate near 99% and student achievement consistently above state averages, the District provides a high-quality education in a close-knit, supportive environment. The District continues to invest in facilities and programs that reflect its commitment to student success and long-term growth.

On July 29, Baird served as senior managing underwriter for the District’s $63,930,000 Fixed and Variable Rate Unlimited Tax School Building Bonds, Series 2025 (the “Bonds”). Proceeds from the Bonds will be used for purposes authorized at the Election held on May 4, 2024, and for paying for professional services associated with the costs of issuance of the Bonds.

The Bonds were offered in two series: a $31,675,000 fixed-rate portion and a $32,255,000 soft put structure, both rated AA- and backed by the Permanent School Fund (PSF). Market conditions were favorable on the day of pricing, with interest rates for municipal bonds generally decreasing by 1 to 2 basis points, helping support investor demand.

There was notable competition in the market from other PSF-backed issuers with similar credit profiles, which made investor engagement critical, particularly for the fixed-rate series. Progress was initially slow on the shorter maturities, but longer-term bonds gained strong traction. Bonds maturing in 2050 and 2055 saw especially high interest, with oversubscriptions of 6 and 12x, respectively. As a result, pricing improved, with yields lowered by 5 and 9 basis points. The 2050 bonds finalized at a 4.97% yield (5% coupon), and the 2055 bonds were priced at par with a 5.00% yield.

The 3-year soft put series also received strong investor interest, ending 5x oversubscribed. The pricing was improved by 5 basis points during the order period, resulting in a final yield of 2.95% for a 4% coupon.

To support the sale, Baird committed to underwriting several smaller remaining maturities between 2027 and 2032, as well as a portion of the 2037 maturity, which remained available at the time of closing. Despite the District’s relatively modest deal size, the Bonds were priced in line with, or just slightly wider than other recent larger PSF-backed offerings.