Berks

Muhlenberg School District accepts $12 million loan proposal

MUHLENBERG TWP., Pa. - The Muhlenberg School Board voted unanimously Wednesday night to accept a $12 million bank note proposal from Fulton Bank.

The board originally voted in September to seek a bond or a loan of up to $12 million, and because of rising bond interest rates since the presidential election, the board accepted the bank loan and its 2.91 percent interest rate.

The loan, which allows the district to borrow the money without raising taxes, will be used to fund the district’s “Blueprint for Success” initiative, which includes renovating the C.E. Cole building, installing security upgrades, implementing technology in each classroom, constructing on-campus soccer fields, and general repair and maintenance.

Fulton Bank will act as the note holder and the paying agent, according to board solicitor Brian F. Boland, The original September resolution named M&T Bank the paying agent. The district will pay the bond into an account and Fulton Bank will release the money to itself instead of using M&T Bank as the paying agent.

In other business, the board voted unanimously to adopt the early retirement incentive plan, which includes nine teachers, as identified by the Public School Employees Retirement System, 11 employees in the MSBA contract, and four administrators who would also be eligible. The incentive includes a May 1 deadline for eligible employees to submit their intent to retire.

District CPA Diane Lucchese said the move to grant the potential retirement of the nine eligible teachers alone would save the district $235,000 the first year, but wouldn’t see savings for the other positions for a few years.

"I think we need to do everything we can possibly do to minimize or save wherever we can, especially if property tax reform passes. There's no guarantee you’ll get enough money to run things," said board member Mark Nelson.

The board will convene March 1 for the committee of the whole meeting and March 8 for the regular board meeting.


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