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A worker with Black Hawk Roof Company takes a break on the roof of Pipestone Area Schools. The school board recently moved forward with a financing plan to complete the re-roofing of the middle and high school next year. Photo by Kyle Kuphal
Pipestone Area Schools (PAS) Board members during their July 28 meeting approved a resolution authorizing the sale of general obligation bonds to complete the roofing project on the middle and high school that started earlier this year.
Late last year, the school board approved a low bid of $3,749,000 from Black Hawk Roof Company to re-roof the middle and high school in two phases over this year and next. The school district had $2,827,313.31 available in bond proceeds that it planned to use for the roof project, which left around $921,686.69 to pay for the entire project.
Steve Pumper, senior vice president with PMA Securities, spoke to the school board during its July 28 meeting about action by the state legislature that takes effect July 1, 2026, and a subsequent plan whereby the school district could sell general obligation facility maintenance bonds to cover what is now a $918,079 shortfall to complete the roof project. The school district could then pay off the debt with LTFM levy funds.
According to information presented by Pumper, the school district would sell $920,000 in bonds and receive an estimated $52,310.45 premium, bringing the total proceeds to $972,310.45. Of that $918,078.97 would be used to complete the roof project and $54,231.48 would be used to cover the cost of the issuance of the bonds. The resolution approved by the board allowed a bond amount of up to $975,000 in case there is no premium when the bonds are sold next year, so that the school district could still have enough funds to pay for the issuance of the bonds.
The bonds would be paid back over the course of 10 years. According to the information presented by Pumper, the estimated tax impact on a home with an estimated market value of $150,000 would be about $5 a year. For agricultural homestead land valued at $10,000 per acre, the estimated tax impact would be about 6 cents per acre. The estimated tax impact for non-homestead agricultural land would be about 13 cents per acre. Pumper said that reflects the state’s 70 percent Ag2School credit, which applies to agricultural land and buildings. He said the Ag2School credit would pay about $490,000 of the $920,000 bond, which is about 53 percent.
A tentative timeline for the project shows that the bonds could be sold next summer. Superintendent Klint Willert said the bond funds must be used after July 1, 2026, so the project was broken into three phases rather than two as were originally the case.
“That phase 3 is effectively what we would be covering with the $920,000,” he said.
Willert asked what the school district could do if there were funds left over after the roof project. Pumper said the funds could be used for expenditures that fall under the state statute governing LTFM funds, which he said includes “like to like replacement” of existing items such as carpet, windows or plumbing.