UPDATE II: At the meeting tonight they approved the designation of banks without listing those banks. There were ZERO exhibits. It seems those names won’t be revealed until August and most likely will be the same as last year. If they follow what they did last year, First National would be on that list. Like the City, it seems the school district uses multiple banks in town. But it is also important to note that Great Western Bank is their main bank that handles most of the districts accounts. It will be interesting to see WHAT bank is chosen to originate the bonds with;
RESOLUTION RESOLVING, that the following institutions be designated as depositories for the funds of the Sioux Falls School District 49-5 of Minnehaha County, South Dakota, effective July 1, 2017; First National Bank, First Premier Bank, Wells Fargo Bank, US Bank, Sioux Falls Federal Credit Union, Minnwest, Dakota State Bank, First Bank & Trust, Great Western Bank, MetaBank, Sioux Empire Federal Credit Union, and the South Dakota Public Funds Investment Trust;
UPDATE III: While the school district is maintaining that they must have the special election in September so they can set the budget for 2019 by September 30, it seems that may only be a ploy for something else. At the meeting tonight the finance director talked about setting the tax levies with Lincoln and Minnehaha County, I believe those levies must be set by September 30 and cannot be amended after that (please correct me if I am wrong). In other words, if the bond doesn’t pass before that deadline, the School Board would have to wait a full year before setting those levies again. I’m going to do a little more digging around on this, but it seems they may have NO choice but to have a special election.
At the school board meeting tonight they will take this action (DOC: 6-OrganizationofSchoolBoard;
D. A motion was made by __________ and seconded by ____________, _____ ( ) votes “yes†on roll call, acknowledging the designation of banks as depositories for the funds of the District; it being understood that this designation will continue until the next annual meeting, unless amended by the School Board at a subsequent meeting (see MRF # and Action ____________, adopted ________).
They also will be hiring Dougherty & Company, LLC to be their ‘financial advisor’ and bond representation if the bond passes (Doc: 13C-RFP-FinancialAdvisor)
It will be interesting to see if they choose First National as one of the banks, if so the bonds will have to pass through them, and if it does, this means the co-chair of the School Task force, Nan Baker has an ‘Enormous’ conflict of interest by sitting on the task force since her family owns First National Bank.
However, the School Board/District could have seen this conflict and chose another bank(s). Of course they could use the excuse that Nan was ‘just a volunteer’. But I’m not buying it. She is a volunteer who’s family will rake in millions over this bond if they are one of the chosen banks.
I am pretty sure that “millions” would be overstating what the trustee fees will be on that bond issue- you make it appear that the bank will garner a large portion of the bond issue proceeds for doing their thing. The bank would be responsible for investing reserve funds, paying out the construction account, and paying principal and interest to the bondholders as those payments become due. I would be surprised if the total fees for the life of the bond would exceed one million dollars. These are fees that will be incurred no matter who the trustee is; First National has been providing these services to the school district on various bond issues for the past 40 years +/- and probably has lower fees than someone who would be new to the game. The investments that would be made are determined by the bond indenture but probably would not include any deposits in the bank itself but rather in US government securities. As to the volunteer issue it would be hard to find someone who does not have a “conflict of interest” as you describe it. Parents of school age children certainly do. Various vendors who do business with the district do. Contractors who build the building have to bid on the project, but likewise if the bank’s fees were exorbitant they would not be chosen for that position. After all of this is said and done I must tell you that I strongly oppose this bond issue so hope the bank has no need to be involved.
First off, let’s be honest about the true cost of these bonds, they will be close to $300 million. Even if you were conservative on bank fees, they would still be making more than $1 million on running the bonds thru the bank. It is one thing to have a concerned parent sit on this task force, it is entirely another to have a family member of a bank that could be used to service these bonds. You seem to be quite naïve about the way politics work in this state and city. I for one, ain’t buying it.
you are not buying that the bank has been providing these services for the school district for 40 years- long before Nan Baker (her married name) was even part of the Baker family; someone has to provide the service and must do at a competitive fee if it wishes to provide that service; that selection 40 years ago may have been a political choice but would not have been renewed with each new issue had their fees been too high; and yes the district has borrowed monies on a regular basis even if there was not a bond vote to do so; there has been regular borrowing over the years and now they might make a million, not the “millions” you suggested earlier; and I like you hope their services are not used as I hope the vote is no
One last thought on this issue. The genesis of Dougherty, LLC was one of the founders – Mike Dougherty, brother of Bill Dougherty, a life long Democrat lobbyist and friend of all things blue; yes I know how politics works in this state- Bill’s daughter- in – law got a life time appointment as a federal judge; but when Democrats are doing the lobbying, getting appointed as bond rep, and getting federal judgships there probably aren’t any politics involved are there? and I would like to review the school board minutes from the late seventies (when Nan Baker was probably ten years old) selecting the bank as trustee- I’m sure someone said well Nan (last name not known) might marry Bob Baker some day and then serve on a citizen’s board