MBS earns top-notch bond ratings
Mountain Brook Schools announced in March that S&P Global Ratings and Moody’s Investors Service had given the district top-notch bond ratings.
This was good news for MBS because — in the following weeks — the district went to the bond market to finance approximately $75 million in capital improvement projects at all of its schools.
In its first time evaluating MBS, S&P assigned the district a AAA rating, the highest rating available.
“This excellent rating reflects the strength of our local tax base and our school district’s unwavering commitment to prudent financial stewardship,” MBS CFO Kari Austin said in a news release. “A rating of this caliber will enable us to borrow money at the lowest possible interest rate and keep us on stable financial ground for years to come.”
The rating highlighted the district’s strong capacity to meet its financial commitments, according to the release.
Only 84 out of more than 5,100 American public school districts assessed by S&P have received a AAA rating, placing MBS in the top 1.64% of rated districts nationally.
Moody’s also assigned MBS a strong rating of Aa1. Entities that receive this rating are judged to be of high quality and subject to very low credit risk.
The Aa1 rating reflects “exceptional wealth and income, strong reserves and liquidity, and elevated leverage,” according to a Moody’s press release.
The rating was assigned to the district’s planned $64.4 million Special Tax School Warrants Series 2021-A and $5.9 million Special Tax School Warrants Taxable Series 2021-B bonds.
The district’s Series 2021-A bonds are secured by a 20.6 mill special ad valorem property tax.
The district’s Series 2021-B bonds are secured by a 9.9 mill special ad valorem property tax.
Mountain Brook voters approved a property tax increase in 2019 to support the schools.
In its press release, Moody’s also stated that the coronavirus pandemic has not had a material impact on the district given its reliance on state aid and local property tax revenue, which are stable year over year.
Having secured its dual bond ratings, the Mountain Brook Board of Education recently met to approve the bond pricing structure.
Capital improvement projects are set to begin following the 2020-21 school year.
That includes breaking ground on the three major projects at Mountain Brook Junior High, Mountain Brook High School and Brookwood Forest Elementary.
There will be three new construction projects — one at Mountain Brook High School, one at Mountain Brook Junior High and another at Brookwood Forest Elementary.
MBHS will see a new two-story academic wing with 42 classrooms, a new counseling suite, a new band room and renovated dance studio, as well as renovated restrooms in the Fine Arts Center.
MBJH will get a new three-story main entrance building with 18 classrooms, a renovated and expanded cafeteria and auditorium, renovated locker rooms and a new pitched roof and turret over the media center.
Brookwood Forest Elementary will have a new addition with a main entrance, administrative suite and lunchroom. Classrooms and restrooms will be renovated. There will also be a new gym roof, HVAC improvements and new paint and flooring as needed.
There will also be extensive renovations at Cherokee Bend Elementary, Crestline Elementary, and Mountain Brook Elementary, with some of the work to be done this summer.