Paul Barr hinted at $45 million debt during July 22 hearing

A careful examination of the July 22 Joplin R-8 Board of Education shows that CFO Paul Barr hinted that the district needed far more than the $8 million that was approved that night to take care of its debt.

At the point in the meeting where Superintendent C. J. Huff was explaining that Barr had found a way to take care of the district's debt problem without having to take a proposal to the voters, Barr made it clear that the debt wasn't limited to the $8 million that he had described at the May board meeting as "might-as-well" spending. The following passage is taken from the July 22 Turner Report:

Huff stepped in and noted that Barr had come up with a funding mechanism to take care of the $8 million in debt, or as Barr referred to it, in another comment that will probably send him to the woodshed, "Eight million dollars or whatever the amount of the debt is."

Huff and the board members were already aware that the district's debt was far deeper than $8 million. As noted in the August 16 Turner Report, Barr sent an e-mail three weeks earlier to C. J. Huff and the board members outlining the situation:

The financing package we are putting together looks like this at this time.  Thefinancing team, including US Bank, will continue developing the package targeting initial Board action on T 7/22.  Currently this is draft information:

Short term financing - offset by future collections from FEMA (75% of building projects), CDBG grant, 404 Safe Room grant, EDA grant  $37 million.  Cash flow projections reflect most of this to be paid off within 6-9 months.  Maturity date 6/30/15.  

Intermediate term financing - offset by future SEMA collections (10% of building projects) and lagging FEMA collections after all projects are closed out - received in the months following 7/1/15.  Estimated $9 million.  Collections during FY16 will pay this amount off.  Maturity date 6/30/16.

Long term financing - for additional building scope items at JHS/FTC - scope items not a part of destroyed buildings.  20 year lease purchase bonds - $8million.  Payable with approximately $600,000 of former capital outlay budget reduced for FY15 and future years for the short term.  Future new revenues to be set aside in pieces to grow to $600,000 for re-payment years 6-20 so the capital outlay budget can be replaced in about 5 years.

 Both the intermediate term financing $9m & the long term financing $8m are planned to bring to the BOE at the September meeting, with a closing in the first half of October. 

The e-mail makes it clear that district officials knew they needed $8 million in long-term financing, at least $( million in short-term financing, and the way the remainder of the $45 million is addressed is dependent entirely on federal agencies approving the way that the money has been spent.

Just as clear was Paul Barr's assertion that repayment of the long-term debt is going to be dependent on new sources of revenue. At this point,the only thing that has been mentioned is selling the naming rights to various district facilities. That can only go so far, however.