Despite a two-week delay in awarding contracts for a new Niagara Street Elementary School, school officials arranged this week to borrow $30 million to pay for the project and for improvements at other schools.
District Business Administrator James J. Ingrasci told the Niagara Falls School Board on Thursday the district had sold bonds Wednesday "at a good interest rate," a result of the improved rating it received from Standard & Poors, a bond rating company.
"They gave us an 'A' rating, which lets us borrow money at a lower interest rate. We had a 'Triple B' rating last year. That's one step below an 'A' rating," Ingrasci said.
On that basis, three lenders submitted bids for providing the funds.
Ingrasci said the district will borrow the $30 million from Citigroup, which offered an interest rate of 4.4 percent for 30 years. Merrill Lynch had offered 4.5 percent, while Bank of America Securities sought 4.6 percent.
The district will close on the Citigroup loan next Thursday.
"We did pretty well," Ingrasci said.
Last December, voters authorized the district to borrow up to $50 million to build the new school and improve and repair other buildings.
Also, District Support Services Director Nicholas E. Marchelos told the board contractors will submit bids Oct. 4 on the Niagara Street project. Contracts should be awarded Oct. 6.
He said demolition of the old school and construction of the new one should begin soon thereafter. The new school is expected to cost up to $25 million in actual construction costs and for soft costs, which include architectural fees and furniture.
Construction will take 18 months. The new school is slated to open in September 2007, he said.
Bids were supposed to be taken Tuesday. But a problem developed on construction of exterior wall panels, causing a two-week delay.
The district had planned to have colored tiles included in precast concrete panels at the factory.
But a major Canadian producer of the tiles informed the district this week that the tiles might crack while being transported to the construction site.
Machelos said general contractors have to be aware they will have to insert the tiles during construction.
That probably will increase construction costs, which have to be incorporated into bids.