KISTA/KSBA Energy Project Bonds

KISTA/KSBA Energy Project Bonds

KISTA/KSBA Energy Project Bonds

KISTA/KSBA Energy Project Bonds A partnership between KSBA and the Kentucky Interlocal School Transportation Association is making it possible for districts to finance smaller-scale projects, such as installing energy-efficient windows, doors, roofs and lighting, along with HVAC and kitchen upgrades.

KISTA is the association formed more than two decades ago to help districts finance the cost of new school buses. While it continues to do that, the energy-efficiency financing is a new offering in response to the work by the School Energy Managers Project. 

The joint KSBA-Kentucky Department of Energy Development and Independence program, funded with a federal economic stimulus grant, has hired 36 energy managers to serve 131 Kentucky school districts. For the past two years, they’ve identified ways in which districts can save money through energy efficiencies – some of which require upgrading buildings or equipment.

The KSBA-KISTA partnership can help districts finance some of those projects with a loan from the proceeds of a bond issue with tax-exempt interest. Ross, Sinclaire & Associates, LLC, is the bond agent and Hilliard Lyons is the fiscal agent. The cost of issuance is split among participating districts.

“The program’s focus is small projects up to $500,000 that are not large enough to bond on their own,” said School Energy Managers Project Director Ron Willhite. “By lumping numerous small projects in this program, districts receive the same benefits of low interest rates and issuance costs of a typical bond issue for a large project, with flexibility in repayment term and funding type --restricted, unrestricted or guaranteed savings.”

The savings generated by the energy improvements in many cases will be enough to make bond payments, similar to performance contracting. Some savings may even exceed the amount needed for repayment, Willhite said.

The main qualification for the program is having an energy-related project, and there is no requirement that projects generate a specific amount of savings to justify the work.

“We believe this is an opportunity for districts to install or upgrade to state-of-the-art control systems that the SEMP energy managers can utilize to facilitate significant, ongoing energy cost savings,” Willhite said.

For more information, contact Ron Willhite or David Baird
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