Katy ISD Work Study Meeting, November 16, 2015

0:00 Unknown speaker not human verified

Section 4.2, Transportation Sustainability Update. Mr. Robertson.

0:07 Thomas J. Gunnell not human verified

Give that heart back.

0:15 Unknown speaker not human verified

There you go, Mike. Thank you, sir.

0:21 Unknown speaker not human verified

Good evening, President Griffin, Board members, Superintendent Fraley. It's my pleasure this evening to present the Transportation Sustainability Update, which will contain some of the information that you've seen before and hopefully a little bit of new. Before we get into the presentation, I'd like to recognize that our transportation senior staff is here this evening, including Mr. Alan Anders, Director of Transportation, and and Mr. Jim Porter, the Assistant Director of Transportation for South, the South Center, who will both be retiring at the end of December.

1:05 Unknown speaker not human verified

This transportation update is presented as a follow-up to the updates that were given to the Board in March of earlier this year and is a continuation of our efforts to maintain the district improvement plan goal, which is to develop a transportation plan that makes efficient use of district resources while maintaining a high level of safety.

1:31 Unknown speaker not human verified

Our discussion goals this evening will be to review the current model sustainability, review multi-bill pros and challenges, We'll review the K-12 Insight Survey results that we did about this time last year. We'll talk about the estimated GOF cost of change to a multi-bill schedule and hopefully talk about the next steps in preparing for the 2016 and 2017 school year.

2:00 Unknown speaker not human verified

We believe we can sustain the current transportation model beyond 2015-16 if our recruiting efforts successful. And current applicants are greater than we have anticipated. We do have a couple of major challenges. We've run into an issue with fingerprinting of the applicants. And also the testing requirements are changed and the sites where these folks are testing are restricted. We would recommend establishing an in-house fingerprinting system and also seek permission from the state to develop our own internal driver testing program. If applicants can be processed timely, our current model should be sustainable in 2016-17 and beyond.

2:50 Unknown speaker not human verified

In addition to the pay increase and retention bonus reinstatement, several recruiting initiatives were begun or or continued, the main initiative was creating a recruiting specialist position in the Transportation Department by repurposing a driver position. This position is responsible for coordinating with Human Resources to continue the quarterly job fairs and to explore all other avenues for applicants. A key strategy in attending is attending and recruiting at campus PTA meetings. Results are good since this time last year. In addition to adding five routes, there are still twice the number of applicants or trainees that we had. And we just had our first job fair on November 6th. It was the best job fair we've had. There were over 260 applicants at May Creek High School. school and over a hundred, close to a hundred of those were interested in transportation. So we believe that the, the recruit, recruiting efforts are having an impact on the applicants we're getting.

4:02 Unknown speaker not human verified

About this time last year we formed a transportation committee to review multi-bill schedules or actually to review the transportation model. The multi-bill schedule was one of the the primary things that came out of that discussion. And these are just a review of the pros and challenges that were identified by the committee at that time.

4:25 Unknown speaker not human verified

From our perspective, the most important pro is that it would provide a temporary relief for the driver shortage situation. Driving three runs versus two runs per route would create a driver pool with the restoration of some, while the restoration of some routes could be accomplished, the primary benefit for the Transportation Department was that we would have sufficient drivers to cover absences without having to use our mechanics and lead drivers and office staff to drive the routes for the absent drivers.

5:01 Unknown speaker not human verified

The primary challenge of adopting the multi-bill schedule is the disruption disruption that it causes to students, staff and patrons. Due to the potential disruption and challenges associated with the multi-bail schedule, the board directed us to conduct a survey, a district-wide survey, about their preferences for KDISD changing from a two-bail system to accommodate the transportation model. model.

5:35 Unknown speaker not human verified

Results of the survey were presented to the Board this past February and established that there was a preference to make no change until we needed to, until it was necessary. If a change was necessary, there was a preference to keep the current walking distances rather than expanding them. And the preferred bell schedule was to have the high school start first, followed by the elementary and the junior high.

6:02 Unknown speaker not human verified

Dr. Shelby McIntosh, the Vice President of Research for K-12 Insight, presented the next three slides to you in February and

6:13 Unknown speaker not human verified

the first one reported that the most favored strategy was to make no changes to the model until the current model could no longer be sustained. The second Second preference was to change to a multi-bill schedule but keep the current walking distances. And options that increased the walking distances were the least favored.

6:36 Unknown speaker not human verified

The majority of the participants preferred to make no changes until necessary. However, when this group was asked if the district needed to make a change, 61 percent favored keeping the current walking distances and going to a multi-bill schedule rather than changing the walking distances.

6:59 Unknown speaker not human verified

This shows that the question was which bell schedule do you prefer.

7:04 Unknown speaker not human verified

The option one of the survey which was the start times ordered by high school, elementary and junior high was the most favored option.

7:18 Unknown speaker not human verified

We were asked to estimate a cost of going to a multi-bill schedule last year. That cost was determined to be about three million dollars a year. The first year cost would be 1.6 million because in that year we would not have to purchase regular ed growth buses.

7:36 Unknown speaker not human verified

As you will recall the The transportation services for regular education students are not required by law.

7:43 Unknown speaker not human verified

Also, the state provides only a partial reimbursement for students who live in excess of two miles from their home campus. This reimbursement covers about 30% of our actual cost, and it's based on a formula that's been in place for over 30 years.

8:04 Unknown speaker not human verified

In our direction, we maintain the current transportation model for this school year. We believe that with an effort to control transportation and related services internally, that we can recruit and retain sufficient drivers to maintain the current model for 2016-17 and beyond. Pursuant to the Tendry Boundaries Modification Decision, the transportation model will be reviewed and see if the modification would prevent maintaining the current model for 2016 and 2017.

8:38 Unknown speaker not human verified

And I'm happy to answer any questions you may have.

8:44 Unknown speaker not human verified

Ms. President?

8:45 Charles Griffin not human verified

Yes, ma'am.

8:46 Unknown speaker not human verified

going back to the multi Bell and the pros that are listed there I I know I've said as a board of trustee and I think most or trustees would agree that the decisions we make have to directly impact our students and I feel like there's some parts of looking at a multi Bell system that maybe we weren't necessarily covered or considered in the presentation tonight. For example, with the junior highs getting out at 2 30, Department of Justice shows that the number one time for teenagers to get arrested or to have violent crimes is 3 o'clock and we're putting these kids out on the street when they're developmentally not quite ready to make some of these decisions. The American Academy of Pediatrics in 2015 recommended that students shouldn't start school before 8, that it wasn't developmentally sound for their, with their circadian rhythm. And looking at the other school districts that either are our size or I believe are our caliber, Northside ISD, Spring Branch, Fort Bend, Alief, Conroe, Houston, Spring, Eanes Leander and Austin ISD they all have their junior highs starting either second or third on the bell schedule and Fort Bend just changed theirs recently and in having the elementary school start earlier actually added 15 minutes of teaching and learning to the elementary school day the only school district in our area that does not it has the same bell schedule that we have to this day is Cy Fair which is a very large school district and a very good school district too um i don't know that i'm asking any questions as much as just kind of stating some of my beliefs as why i feel like looking at changing the bell system and is respectful of the children and their development their safety with traffic patterns with having a junior high in a high school sharing a campus i pick up my child multiple days a week on a shared campus and i can't tell you how many times junior high you know kids have run across traffic without out and there's just double the amount of traffic um so i don't know that i'm asking the question necessarily it's just making a statement but i thank you for you

11:02 Unknown speaker not human verified

uh ms van those are all good points and honestly a lot of them were beyond the scope of the study that we did particularly the impact on learning for high school or starting later for example We've looked at some of the data that's been presented. There is a case to be made for that. However, it would be our recommendation that we conduct a different study for that if that's the direction we need to go.

11:33 Unknown speaker not human verified

Go ahead, Ms.

11:34 Unknown speaker not human verified

And I guess that should have been my question is why are we solely looking at this as transportation when the scope of it is so much more than bus routes? So I thank you for your response. I think that that is a very valid answer.

11:49 Unknown speaker not human verified

And Ms. Vann, if I could, I don't think as a district we've ever done a comprehensive needs assessment. I don't think we've ever gone out and went to the public and said, hey, here's where we are. What does the community want us to do? I think you have got a lot of concerns. And I think we as a board need to consider asking the superintendent with a comprehensive needs assessment. and you know Mrs. Fox had a phenomenal plan when she had a 200 member bond committee I think we've got some some procedures in place that could probably take this Mr. Fraley. President I think that first of all I think Ms. Mann thank you for your information as well and Mr. Robson for your report and Mr. President for your words there I think that

12:34 Unknown speaker not human verified

the district has grown so much and I think it is time to take a pause and kind of think through the next steps where we want to be and really come to rally around the new vision statement you've adopted. That's a great thing to rally around and to really begin to look at everything that we do through the lens of how or the filter of that vision statement, well it's a mission statement as well. I think that it probably is time to take a pause and begin having some conversations a little more holistically so you don't do kind of a random act of improvement but not and those things can be considered if we consider Mr. President yes ma'am I also agree with Miss Vann with regard to looking at this a little more extensively not just based on transportation needs but based on what is best for our students I too have children at a junior high and high school that share land and it does concern me because we have multiple schools like that and now we've just approved another building of a junior high and a high school in the same area

13:44 Unknown speaker not human verified

and it would be advantageous for us to have them offset just enough for that trap for those traffic purposes because it is a nightmare and it is dangerous and you've got young drivers that are whipping in and out of that school at that time and then you've got your junior high kids that oftentimes are still either walkers or bikers. You don't see a whole lot of high schoolers that are still walkers or bikers unless they're really close. Most of those kids are driving, drive by any of these high schools, and you can see the number of cars that those children are driving. And so it is very scary. So I think that on top of that and us continuing to be pro having that junior high and high school together, you know we have solid reasons on why we do that yet staggering those times could could be beneficial to those areas into the traffic into the safety of those students as well as looking at some of the other research that has been found that students at that age level should not be starting school at seven something in the morning I've read research where because there has been some comments back when I've when I've talked with people in the community They're like yeah, well if they start high school late those football coaches are just gonna make them practice early And it's really not about them getting up at that time It's about when their brain turns on academically and so technically They could get up and go swim or play volleyball or cheer or dance or whatever their Extracurricular is at that time. It's it's when their brain is ready to receive the data that's being given to them So I too would like to see more research done on that we are you know we just adopted our vision statement of be the legacy and there's other big districts out there that have models that we can look at and I think that it's time for us to maybe make some changes even even in the elementary school staggering times 15 minutes if you need be I know I live over in the area of Stanley and Schaefer and Randolph and that whole area is crazy with everybody trying to get to just those elementary schools so I encourage encourage us to dig a little bit deeper and not make this just about transportation but about some of the other factors as well.

16:00 Unknown speaker not human verified

As long as we have time to pick up and deliver the kids between the schools, we're happy to look at whatever model you direct us to look at.

16:09 Rebecca Fox not human verified

Mr. President.

16:10 Charles Griffin not human verified

Ms. Fox.

16:12 Rebecca Fox not human verified

I have, like I echo Mrs. Vann and Mrs. Doyle's sentiments about the looking at the child's, the whole child and how they learn best. So I completely agree with the research that's done about circadian rhythms and how children learn best. And there are lots of school districts going to high school or starting late and how beneficial, and even junior high and all that. But so I support that theory and am in support of that. And I really appreciate President Griffin's idea of a needs assessment. Let's see what our community wants. And let's talk about learning. Let's talk about academics outside of transportation Let's talk about our needs for our whole district and what that looks like and what our community wants and what they support Outside of transportation because I believe that we need to make a transportation decision Now that or very soon so that our community has enough time to prepare if we're going to make a transportation change It needs to they need to know now so they can make preparations for next fall. So I am very grateful to You mr. Robinson and mr. Anders and everybody over there and nobody asked me if they could retire so I'm not so sure it's happening but The fact that that we had such a difficult time

17:36 Rebecca Fox not human verified

Getting enough bus drivers that caused our moving to half mile and And now I hear you say if we can find a way to process inside the district to quicken the process so we can get more drivers on, that we have drivers who want to come here. And I understand the challenges that we have of how difficult it is to be a bus driver. Until we had this challenge, I didn't know. Remember Mr. Huckabee talking to us about it's more difficult to become a bus driver than a teacher sometimes? That kind of thing, the challenges you all deal with and how you've made it work. And with our increased growth, you're still making it work, and that's because we have people who are problem solvers and people who don't take no for an answer, but how can we make it work? And you just showed us that. And I'm very grateful and quite impressed.

18:28 Unknown speaker not human verified

And you remember the transportation department. I thank you. They did the work. Yes, sir, Mr. Dubrow.

18:36 Unknown speaker not human verified

I would like to echo those comments. I remember when we moved from one distance to another and how this room was filled and we didn't have enough drivers. There was nothing we could do about that. So I congratulate you on increasing your recruitment efforts. I congratulate you on increasing your pool of drivers. Outstanding job to responding to that need because I lived through that, pulling it back. I remember meeting Mr. Mihulski and I had over at his office with some very upset parents. But you've responded to that need. But I would support a comprehensive study because I do believe this isn't a transportation issue. I remember a year ago now this time, Ms. Fox and I were sitting up here talking about the very same thing, about the circadian rhythms of these kids and the later start times and the research that came out on that. I think we need to have a conversation with our community and we need to also Look at some of those studies in depth and have some conversations with our educational experts about that because a lot of times things published They don't have the entire story. So I would like to get the entire story as well as let's have a conversation with our community about that

19:53 Charles Griffin not human verified

Mr. Mahalsky

19:54 Bryan Michalsky not human verified

Thank You. Mr. Griffin I will also echo the same sentiments on doing a comprehensive needs analysis. I think that is an important part of the overall process. As far as, you know, I will take a little exception, though, when we start talking about what other districts are doing. And while I think we should look at what other high-performing, fast-growth districts are doing, at the same time, I'll put our record up against any of them. And I think we'll come out quite well. So I think it's really more about having a conversation with our community hunting out and really determining what those values are and and then Coming up with a plan that meets those

20:38 Bryan Michalsky not human verified

Thank you, Brian

20:41 Unknown speaker not human verified

Any other questions?

20:43 Charles Griffin not human verified

Mr. Fraley

20:44 Unknown speaker not human verified

All right. Thank you. Mr. Robertson. Absolutely anything briefing. Thank you Moving on to Mr. Fox. Ms. Fox, yes, ma'am.

20:51 Rebecca Fox not human verified

Maybe I could just ask. I know that people are going to call me going, so is the bus going to change next year? They're going to ask me that. So we're able to sustain our model and that's going to be the plan going forward, is that my understanding?

21:05 Unknown speaker not human verified

That is correct.

21:07 Rebecca Fox not human verified

Thank you.

21:07 Unknown speaker not human verified

Thank you, ma'am. All right. Thank you, Mrs. Fox. Number five, consent agenda 5.1, considering future Board approval of proposals for the College and Career Counseling Program. Mrs. Stevenson.

21:33 Rebecca Fox not human verified

Good evening President Griffin, Board Members, Superintendent Frehley. I brought two contracts forward for your consideration tonight and I have my experts with me to answer questions on these particular contracts. They both took a great deal of research and evaluation before we brought these recommendations forward. The first contract is a contract for college and career counseling program solution, and the recommendation is to award to Naviance, Inc. The Counseling and Psychological Services Department at Katy ISD under Dr. Anita Horton, they were seeking a program that would provide an online planning tool for students, parents, and staff with comprehensive resources to facilitate the research of post-secondary options. They were seeking something that was user-friendly, that had an interactive platform, and with the sequence of easy-to-follow steps for both the parents and the students, and with action reminders so that the students knew what to do when in order to complete applications. They wanted the software package that would provide training for the staff, the students, and parents with online support as well. And accordingly, we identified three products but only two submitted complete proposals to us for evaluation. The team of evaluators, which was led by Dr. Horton, included representatives from the counseling staff, the technology department, and senior administration, and all are unanimously recommending that Naviance Incorporated be the solution of choice. The solution is robust enough to provide college searches, resume building and uploading, auto alerts to parents and students from the counseling staff, the tracking of college applications, data banking so that the information input can be applied to multiple applications, and the tracking of all data. It will even assist the district in the tracking of past graduates for data building purposes. So the recommendation is for a one-year contract with an option for four additional one-year renewals at an estimated annual cost of $148,289.44. This is based on a cost of $4.05 per student if all the components of the program, including the career counseling, are utilized. And this was based on our estimates of 15,999 students for middle school and 20,628 for high school. And if approved, the program implementation will begin immediately with the program fully accessible by the end of January of 2016.

24:11 Unknown speaker not human verified

The funding for this will be from

24:13 Rebecca Fox not human verified

general operating special project special general operating funds special projects and the actual cost will actually be based on the student enrollment and the components that are utilized. And I do have Dr. Horton here

24:27 Unknown speaker not human verified

to answer any questions.

24:31 Unknown speaker not human verified

I may not get two quick ones. Would the access allow allow the students to do it at school and at home? Yes, sir. Okay, and if this program is moved to consent, how are we going to track the effectiveness? Like we do it this year and we do it next year. Are we, is there a measure that we can use to know if that program was really successful and and used for the kids? We have not looked at that in terms of the discussion with the company, but I'm sure that there is a component of that that we can look at.

25:04 Unknown speaker not human verified

Thank you. Any other questions? Okay. Ms. Stevenson, 5.2. Okay. The next contract

25:12 Rebecca Fox not human verified

I have for you to consider tonight is the Katie Online Learning Academy Program.

25:19 Rebecca Fox not human verified

This particular learning academy provides credit recovery and original credit courses to support students staying on track for graduation. Students are recommended by their counselors for credit recovery or district approved original credit for courses. These courses are aligned by district curriculum coordinators with course facilitation provided by the online learning coordinator.

25:44 Rebecca Fox not human verified

This particular program was evaluated. We went out seeking a solution, and it was led by Darlene Rankin, the director, and Susan Richards, the manager of the Instructional Technology Department. They led an evaluation process with a team that included an associate principal, a counselor, online learning coordinators, as well as representatives of the technology department. And we also included the director of secondary curriculum and instruction and secondary curriculum and instruction coordinators.

26:17 Rebecca Fox not human verified

Although five proposals were originally received, one was eliminated due to not meeting the instructional requirements. The other two programs were eliminated because they didn't meet our technical requirements. I'm sorry. Two were completely reviewed with all demos and everything being evaluated by the team. After this comprehensive review, the unanimous recommendation is to contract with Edge Annuity. There are a number of reasons for that which were detailed in the recommendation, including the better content presentation. It also includes better assessment tools, better customization. It has a better administration module, and the technology met or exceeded all of our technology requirements. It is aligned with our TEKS, and it is mobile compliant. And it has all the standard reports that we need, as well as it allows for some custom reports to be developed. If approved, the process of the course customization will begin in January with the full implementation of the program with the 2016-2017 instructional year. So the contract period will be for three full years starting with the instructional year and then there is an adoption for two additional one-year renewals. So the original cost of the program for the initial development and three instructional year periods is $331,300 and that includes all nine existing high school campuses and the addition of the high school schedule to open in 2017. There are two optional one-year renewals. The initial cost for the setup will be $35,000. That's from now until the beginning of next school year. That gives us a chance to begin the implementation and get the courses set up. And then the the cost will be $110,433 per year. It will be funded from the General Operating Fund.

28:11 Rebecca Fox not human verified

Mr. President.

28:13 Charles Griffin not human verified

Ms. Fox.

28:13 Rebecca Fox not human verified

Mrs. Stevenson, how is this different from what we do now? I have my experts here to answer the questions. There they are. Because we have the COLA labs at each high school now, is that correct?

28:25 Unknown speaker not human verified

Yes, each of the high schools has a COLA lab, and RAINS and OAC also participate in the program. We're currently using another product, and we're at the end of that five-year contract. So we went out for evaluation.

28:39 Rebecca Fox not human verified

Will they be rewriting the entire content, or is it pretty standardized? You know, I would guess that lots of school districts do.

28:46 Unknown speaker not human verified

The courses from Edgenuity are all aligned to the TEKS, and we'll work with the curriculum department to align the courses to our particular unit plans.

28:56 Rebecca Fox not human verified

And I guess I'm just still getting to the how much different is it than what we do now, and did you get input from the teachers who operate those and are they comfortable with the new product? Yes, all of the

29:08 Unknown speaker not human verified

curriculum coordinators for secondary involved in the selection process as were some of the COLA lab teachers and there were a lot of features that we had been lacking in our current product.

29:21 Rebecca Fox not human verified

It's a great opportunity for students of course to recapture credits and things like that.

29:26 Unknown speaker not human verified

So and that's the goal of the program is to keep students graduating on time.

29:30 Rebecca Fox not human verified

Okay, great. Thank you so much.

29:34 Unknown speaker not human verified

Any other questions? Thank you all very much.

29:44 Unknown speaker not human verified

All right, moving into Section 6, Discussion and Action. Mr. McElwain is going to discuss 6.1, Future Board Approval of Design Services Associated with Elementary School, number 40.

29:56 Unknown speaker not human verified

Good evening, President Griffin, Board members, Superintendent. Fraley. The next six agenda items are my items. I'd just like to make an initial comment that all six items and the associated contracts have been reviewed by our construction attorney and her approval is attached to each one of these particular items. The first item as Mr. Gunnell had mentioned earlier is associated with the advancing of elementary 40 and in that regard the the approval of design services associated with this particular project. If you can recall, over the last several months I have been bringing to you various easements associated with this project. So I'm pleased that we've been proactive in that regard insofar as it's positioned us well with respect to ensuring that the utilities are available. because moving this school up to 17, obviously we're up for the challenge, but in the market that we've got now currently it's an aggressive schedule. We would be hoping to bring to you, with the approval of Design Services, we would be hoping to bring to you in approximately March, next March, the construction pricing for this particular project. So there's not a lot of time between now and March so it is timely that we bring this particular item at this at this point in time. Once again for the benefits of the the audience that this evening is that this particular school is located out adjacent to Willow Creek Farms and the Young Ranch development in what I would call the far west central portion of the school district. So we are recommending it's a refined repeat. We had master plan when the bond bond program was built it This was taken into consideration. Todd Lean with VLK Architects is here this evening. Everyone is extremely pleased with the design of this particular project thus far, so we're anxious to move forward on this and to provide the relief that Mr. Gunnell and Dr. Poole had alluded to earlier.

32:06 Unknown speaker not human verified

Thank you. Any questions? Any objection to move the sign of consent? So moved. 6.2.

32:12 Unknown speaker not human verified

The next item is associated with the improvements to the Katy exterior athletic facilities and the ESC shell space build-out and associated renovations. If you can recall, back in August and September, I brought design services approval to the board as well as the approval of the delivery method. Both of these projects, both the athletic facilities project as well as the ESC project was recommended and approved as construction manager at risk delivery method. In the market that we're in now, we're looking at every opportunity to to achieve benefits to in the best interest of the district and in that regard we felt that it was advantageous, the team felt that it was advantageous to to group these two projects together since it was CM at risk it would add increased interest to the to the sub trade community and in actual fact we actually did receive four submissions it's not unusual in the market that we're dealing with now some school districts are maybe receiving one or two submissions on projects so we are pleased with the submissions that we received for these projects we are recommending this evening Dramala construction day after the submissions were received and evaluated, Dremalla was ranked the highest of the of the firms. Dremalla, as you know, is the contractor that's currently building these soft wall renovations over at Katy High School. So obviously there's some benefit there in having them on this particular overall campus. So we are recommending this evening that Dremalla be awarded a construction manager risk contract for both of these projects. And just to recap, as far as schedule goes, we would be looking at completing the ED support complex work, the shell space work by substantially complete by August, and the exterior athletic facility improvements roughly in that same timeframe.

34:19 Unknown speaker not human verified

frame. Thank you. Any questions? Any objection to move this item of consent? So moved.

34:26 Unknown speaker not human verified

Sir 6.3. The next item is associated with the construction or the expansion of the South Transportation Center, another 2014 bond project. I'm extremely pleased this evening to bring to you the results which indicate that we are under what the bond allocation is on this particular project. There were five sealed proposals received on this particular project with Teal Construction being the highest ranked in that regard. Teal actually we have two representatives tonight, Dwayne Lucas and Dave Ogden are in the audience this evening from Teal Construction. Teal actually has a lot of familiarity and construction experience in this type of construction. They also were the firm that actually constructed the over at the Franz Road Support Services complex complex, the warehouse annex building, and they completed that in an excellent manner and within a very tight timeframe. So we're extremely pleased. I'd be remiss if I didn't give recognition to Doug Benson is here with Huckabee tonight, the architectural firm that worked on the project, Scott Walker as well as my construction project manager on this project to bring this project in under the the approved bond amount and we're able to get the alternates approved which and those alternates are primarily related to site improvements thank you any questions I think you made mr. Smith smile when you said that word under I do my best any

36:03 Unknown speaker not human verified

objection to move in this item consent so move thank you sir 6.4 the next item

36:10 Unknown speaker not human verified

It's customary for us to bring materials testing directly with the approval of the construction on this particular project. So the materials testing for the South Transportation project, we are recommending that that be awarded to Terracon Construction. They have done the previous work at this particular campus and they are best qualified for this particular work. the the the funds associated with this aspect of the work are already within the approved total project amount for this project any questions any objection

36:47 Unknown speaker not human verified

to move in this item consent so moved thank you sir 6.5 the next two items are associated with the student the new student activity facility the second stadium the first item is and I before I go any further I really have to recognize the efforts of Duratec Construction, our construction manager for this particular project,

37:10 Unknown speaker not human verified

HKS, the architectural firm in conjunction with VLK on this particular project from a design perspective, and Nathan Fuchs from my office.

37:20 Unknown speaker not human verified

They have worked extremely hard to bring this project in at a price that that is within within within the amount as far as the the base base stadium price obviously in the market that we've been dealing with there's been value engineering work done similar to what we needed to do with respect to the high school project but without compromising the function the function and the operation of the facility this particular amendment to Jurotek would be the amount of $48,822,000 with a total cost for Amendment 3 not exceeding $53.8 million.

37:57 Unknown speaker not human verified

There was a previous, if you can recall a few months ago, I brought you another amendment that was dealing with site development which is directly associated with the construction of the stadium. That the site development is primarily site-ready building, pad paving work in the immediate vicinity of the stadium. So when you add that particular amendment to this amendment that which you have a first reading, as you can see, we're extremely close to the amount that was identified, the base amount that it was identified for the stadium proper in the bond program thank you for that explanation any questions i see macklewain still is hill is still there and i sure enjoy seeing that take a picture any objection to moving this item to consent so moved and sir i think your last one is 6.6 right uh the last item is an amendment is in another amendment it's an amendment number four. This amendment is associated with four alternates that were identified when we brought the design to the board for approval in July. We had identified at that particular time four alternates that we were going to be asked for or ask pricing for. The specific alternates are the student drop-off loop, exterior a building lighting LED, building lighting that would enhance the the exterior illumination around the stadium and improve safety, pedestrian safety around the stadium. The second floor build-out of the field house, if you can recall when we brought the project initially, that was not, and when it was listed in the bond program, it was not listed as a build-out. It was just to be built as a shell space. that we feel that the team feels and its senior administration feels that it's extremely beneficial to complete these alternates. The second floor build-out that as you know includes not only the three large multi-use meeting spaces that would be extremely valuable to the district but also will provide space for the athletic department to move into. The last the fourth alternate is for a maintenance building, a standalone maintenance building on the particular property. So amendment number, the total project cost associated with amendment number four is 2.9 million dollars approximately. In talking with Mr. Smith I've identified here that the funding would come from available bond funds or general operating funds. In talking with Mr. Smith, currently we are anticipating using available bond funds. We will be bringing as we normally do and when there's a deviation on the cost we'll be bringing a budget amendment next month to the board and at that time it'll identify the source of funds for this particular work but once again that the team senior administration feels that these alternates would be extremely beneficial to the to the project thank you any questions mr president mr maholsky i i need a little better

40:55 Bryan Michalsky not human verified

explanation on on remaining bond on where those bond funds are coming from i mean are we are we talking about bond savings on other projects that i know we're going to have with construction cost where they are and not everything's been bid yet right um right i'll just make you want to be

41:12 Unknown speaker not human verified

a little probably chris is probably mr smith is probably the best to answer that particular

41:16 Lawrence Greer not human verified

question we currently have project savings identified for for this amount we were able to do things with the 1516 general fund budget and that helped identify some additional funds as well as for project savings. But right now, project savings are what's earmarked for this.

41:35 Bryan Michalsky not human verified

All open for questions. Go ahead. Because I knew, I mean, what do we have left to bid out of the 2014 bond package? We certainly, I know that you've made a statement before that we felt like we can get everything done with the allocated funds.

41:53 Unknown speaker not human verified

We're committed to that. We have a regular monthly meeting. senior administration, technology, Mr. Ganell, Mr. Smith, to look at the budget in a holistic way. And we're tracking projects. Some come in high, some come in under. We feel that we have generally funds available to complete all the projects that were identified.

42:16 Bryan Michalsky not human verified

That's good. In fact, may I ask one more? Because this does fall above and beyond the scope of the stadium proper itself. itself, and I do know that the bond committee deliberated much about this and basically gave a pretty much not to exceed number. So this is something I definitely want us to discuss and make a good decision on. I certainly would like these things to be done as well, but I am a little hesitant.

42:46 Unknown speaker not human verified

We are confident, and just a good example is this evening you see we're significantly under with respect to the South Transportation Facility. Hawks Landing the that junior high came in under budget. The junior high 15 came in under budget some other ones came in over but we're tracking I want to assure the board that we're closely tracking all of the projects so that we can ensure I know that there's there's other districts that are having challenges around the Metroplex whereby they're maybe not able to complete all the projects that they'd identified in the bond. I'd mentioned some of the some of the ways that we're doing our very best to get we're getting competition on projects we're bundling projects we're doing a number of initiatives to to keep the costs as low as we can to be able to enable us to do some of this work that really will be beneficial because ultimately and obviously it's an approval of the board ultimately we would be going back and requesting the board to do these alternates. We know what's happening construction inflation-wise. We see it extremely beneficial, not only from a functional perspective now, but also from a cost-effective perspective to complete this work at this particular point in time.

44:01 Unknown speaker not human verified

And if I could, I believe when we had the discussion on the build-out of the second floor, the board really said if there's any possible way to do it, I mean, we really saw the need to get it done.

44:13 Charles Griffin not human verified

Mr. Gunnell?

44:14 Thomas J. Gunnell not human verified

If I could add a couple things. We've talked about the program and how the program needs to work. We have a bunch of projects that make up the program, and it's how it all works together. So today you saw a couple things. You saw South Transportation coming a couple million dollars under. You also saw that you moved forward a project by a year, which probably says, what, 10 percent in inflation, Peter? Right, that's correct. So you picked up a couple million bucks just by doing that, more than enough to cover up to cover the options that Peter's talking about today as far as alternates go. So as far as a program goes, we try to make it work holistically.

44:52 Unknown speaker not human verified

Thank you. Any other questions?

44:55 Rebecca Fox not human verified

Mr. President.

44:56 Charles Griffin not human verified

Ms. Fox.

44:57 Rebecca Fox not human verified

So I appreciate very much Mr. Michalski asking that question because the bond committee was pretty specific with us about a they didn't tell us exactly what they wanted, But they said we want as much as you can get or and they put an amount in the bond for us and so I Appreciate you know the eagle eye on that any idea if maybe that project might find some savings there or I Really do think as a board we have to talk about it amongst ourselves and say we think that our community Would want us to spend a savings from maybe South Perth stands for transportation I mean, I see it as a very great thing to do, fiscally responsible thing to do, to have all the building that we can do at one time. Because we know that when we go back in and make additions to something, it's way more expensive. So I understand the wise decision of that, but because that 200-member bond committee worked so hard and gave us pretty specific feedback, I think it's prudent for us, the seven of us to say yes and we'll we'll do you know if we're gonna do it I agree with mr. Mahalski I think we need to have that discussion if we could I'll

46:20 Unknown speaker not human verified

start this one anybody know where the athletic offices for the administration is yeah very very small and they're writing a new high school we're adding new junior highs and you need administration and I think what we've seen as a board as our administration's running with bare bones so they need some room to grow and this is one of the areas that we're given an opportunity to put some of our administration in a position where they need to be so just part of that build out in addition for rooms for training in addition to office space we got to have growth and this is a phenomenal place to put it where we have the structure and now we have the means at which we can actually help the administration do the job that they're supposed to do.

47:09 Bryan Michalsky not human verified

May I add something? Sure, go ahead. Given that, and I don't disagree with any of that whatsoever, where I'm hesitant is actually using bond funds for this expenditure at this time as part of the 2014 bond package. We know, based on the presentation we had earlier on the ABM, that another bond is coming in 2017 we're going to continue to need to build schools and um

47:39 Bryan Michalsky not human verified

we need to we're going to need to pass that bond as well and i think there definitely needs we need to make sure certain that we are doing what we tell the community we're going to do for them and i feel like the cap on this stadium was 58 million dollars um not that i like it necessarily but I think the communities spoke pretty loudly on that and it was obviously it failed the first time we put it on the ballot so we need to

48:09 Bryan Michalsky not human verified

listen even though sometimes some we may not like what we're hearing

48:15 Unknown speaker not human verified

mr. Dorff okay so in our last bond when we got to the end we had had enough savings to build two new elementaries are we saying now that look we were able to save this money here there and so now we've got 2.9 million dollars we can do this additional space to the to the stadium or are we waiting until we get quotes back from everything and then we say hey look the overall savings here is X amount of dollars now what do we want to do with it are we already projecting I'm projecting the as that what I don't want to do. I'm totally in agreement with the building out this space I do think the administration needs it I know that I was one of the ones that asked the question about could we get it done? But what I don't want to do is I don't want to prematurely say oh look we saved here and we saved here it Automatically goes to this if we could potentially have enough savings that could build another school if we could Potentially be in a position where we were in the last bond where we built two new schools. I I think it's probably safe to say this bond, because of the climate that we're in, that we will not have enough money for a new school.

49:29 Unknown speaker not human verified

A new school. A new elementary school is probably $30 million. Okay. And we know that there are some schools, as I mentioned, there's other projects that are coming. They're over. They're under. And we're tracking. We're estimating where these schools and renovations are going to come in. in working with Mr. Smith, Mr. Ganell, we know we would not bring this item to the board if we felt that there was a problem or that this would jeopardize any of the projects. One of the, as I mentioned just to reiterate, it's being brought because from our perspective, from a professional perspective, we're saying from a functional and operational perspective as well as a cost-effective perspective. It's obviously more cost-effective for us to get this work done now than to come back later because the price would be higher not only in startup costs with the contractor but obviously material labor costs would be higher at that particular point in time well and I respect that as well which goes back to what you're saying Brian which is they were given we were given a specific number but at the same time I see the flip side which is if there's savings there to do it now versus spending more later we need to consider if I can I know that this is a different type of facility but Memorial Parkway Junior High was a good example where we actually came forward and we said there are some additional it's a school environment but we said we said there's some additional additional items that need to be addressed and the board supported us in that because the one of the the same rationale it's easier for us to do it more cost effective to do it and it's functionally beneficial to that particular campus. Remember Emily Craig was here speaking athletic areas. That particular project was there was a bond number that was approved similar to this particular project that we that the board opted to go higher on to be able to benefit that particular environment. So we're talking not about a school environment but there's another it's a it's a student activity complex that's going to benefit a number of number of groups within the within the organization i agree i agree i just think that i think that we i agree with mr mohawk we just need to be cognitive of

51:43 Unknown speaker not human verified

the attention and um the feeling of the community about this facility and so i just think it's something we need to discuss further on what's what is the most cost savings for us as a community

51:59 Unknown speaker not human verified

President? Mr. DeBrell.

52:03 Unknown speaker not human verified

One concern that I have with this is that the stadium unlike an educational, or it's an educational facility unlike a traditional school, really divided this community. And what Mr. Moholsky said is that they gave us a cap of $58 million. If we can put a roof on that stadium for 58 million dollars then let's do it but because of a division in the community I to him a little hesitant and I think we need to be very careful because we are gonna have to go back and ask our community for more money in a few more years and we have to be very careful as to when they tell us this is what they want I'm going by what would know what would they said. Say $50 million. Mr. Fraley. As I recall the discussion among the bond committee was not do this and only this, it was get as much as you can but this is all we're gonna give you. And they wanted a 12,000 seat stadium with the 10,000 seat budget, reading 12,000 seats.

53:11 Unknown speaker not human verified

It was not about don't do this, it was this is all we're gonna give you. And again the division was not as much about the number but how it was framed by a lot of folks and we just didn't have the right information out there about it and i do recall that the steam center was one of the things that

53:27 Unknown speaker not human verified

criticized for and look at it now and and i just think that this is not disrespecting the community at all actually it's maximizing what we were asked to do in a way that's going to be very functional and a benefit to the district i think that uh three years from now you'll be glad you did it like the STEAM Center.

53:49 Bryan Michalsky not human verified

Mr. President? Mr. Mahoski. To that point, and I believe you're absolutely right, but we also built the Shaw Center with general operating funds. And if that's the board's will to do this with that, I could support that. But the bond funds is what's giving me a little bit of heartburn on it.

54:21 Charles Griffin not human verified

If I can add one more thing, and also, again, this is part of the misinformation last time around. This is not the stadium. This is not needed for the stadium. This is for other functions that are associated along the side. This is not the stadium.

54:37 Charles Griffin not human verified

Ms. Fox?

54:39 Rebecca Fox not human verified

Mr. President, Mr. Michael Wayne, if we were able to save $2 million on the transportation, which is a much smaller scope than the stadium, might we be able to save on the stadium so that we could get more, we could get this in the $58 million? That was the specific instructions. Or let me do a two-part question and then you... No, just answer that. The other question is for them.

55:06 Charles Griffin not human verified

Mayor Tory Well as as uh as uh Superintendent uh Fraley uh aptly put it uh the the bond the the challenge that was put before us was a 12,000 seat stadium really we had put it we had priced it as a 10,000 seat stadium and the and the decision was to go build a 12,000 square uh seat stadium for that 10,000 seat price so and as that's why I was recognizing the team because it's hard to describe the amount of time that's that's been spent over the last and hours the last little while getting the number down to this number you've already squeezed that way yes yes because it was a challenge it was a the district that we're getting a 12,000 seat stadium and in a market when we did the bond and we had the bond planning that was really prior to this increase in construction inflation in the market that we're dealing with currently so it's sort of a double whammy before us there.

56:07 Rebecca Fox not human verified

And just to reply to what Mrs. Doyle was asking about saving the money and building those elementary schools, I mean that was an entirely different scenario when everybody else wasn't able to build, everything came less expensive

56:20 Unknown speaker not human verified

because the demand was entirely... In 2008, the downturn back... And we saved a lot of money with the fee sense, so

56:29 Rebecca Fox not human verified

that was a lot of savings and a great thing, but I don't see that happening this time. Okay, Mr. President, I have a question for you. Go ahead. Because of the concerns Mr. Michalski first brought up,

56:44 Rebecca Fox not human verified

how would we feel, the seven of us feel, about asking the Bond Review Committee their input?

56:56 Rebecca Fox not human verified

Normally the Bond Review Committee is there to look at what we've done and to say we did what we promised we would do. I get that's their normal scope and that's not really this but I

57:07 Charles Griffin not human verified

Honestly, I think that would be shirking our duty as a board member number two the question I kind of have is if This project was being done at the ESC or this project was being done at The Shaw Center would we be saying we can't do that because that was outside the scope It seems to me. We're all hung up on the word second stadium when this is not the stadium as we talked about this is space to train us train the staff train administration a place to hold functions for the students this is a place where our administration can do the job that they're tasked to do that happens to be located at the stadium location we're not asking to increase the cost of the stadium we're not asking to put new turf or a roof or any of that we all we're asking or they're asking for is can we build out the second part that we as a board attached them to look into so yeah I understand that you think the second stadium is costing more but it's really an addition to a facility president good

58:21 Unknown speaker not human verified

and also I think I heard is more concerned about the source of the funding and you know we looked at using the GOF and we could we have a great fund balance if that if that's what we want to do but we'd like to say the gof or a lot more flexibility because we're looking also health insurance costs and other things that come into play and at two or three million dollars that you're left we're leaving is about another 1% salary increase with staff I'd rather if we have the funds to do it over here I really use this pot of money doesn't have the flexibility versus part of my it is a flexible mr. McElwain right now you projected 2.9 to do this type of work when you come back to us uh say in a year let's say hypothetically this doesn't go through you come back to us in a year or two you think the price is still going to be 2.1 without a doubt without a doubt without it's going to be 2.9 in a year pardon me no no i'm sorry i thought you i'm sorry maybe i didn't hear correctly without a doubt within a year those prices will be increasing more than that number i can't say specifically how much but if the market continues the way it is it's going to it's going to increase because the volume of work in the Houston area is not decreasing there's labor shortages are going to translate into higher costs plus there will would there would be some additional sort of startup costs associated with bringing sub trades in at a later date than what they'd originally identified go ahead with that being said I hear what you're saying mr.

59:56 Unknown speaker not human verified

Mr. Mohorski, that the bond committee had given us a specific amount of money. But I appreciate that you clarified that if we were talking about this being built out somewhere else would we? Would we be hung up on the word stadium? I think if we wait Like what you just said let's project it out. We don't do it now. We do it in three years We've had Lance come and talk about the the development and just in Katy alone And so let's say we double in price so now instead of it costing us 2.9 million dollars It's costing us six million dollars, and I think the community and the taxpayers are going to come back and say why didn't y'all? so I think that they have to trust that we're being guided by the professionals that are seeing the numbers and That looking at the trend of growth and and the construction costs and things like that that we actually are being more fiscally responsible by doing it now or the cost is less versus waiting and Increasing that projected cost because it's clearly something that we need so I I appreciate what you're saying, but I think that as a community, they've also put us here, and I hope that they trust us that we need to really look at all the different factors and do what's best for us right now.

1:01:11 Unknown speaker not human verified

President, if I could add, I think you're going to see people lined up to use the space for school events or banquets and galas, things like that. So space here in the areas, is that a premium? Is there enough space for activities like this? It's more than the stadium. When it's not in football season, you'll have folks using the facility for other reasons without a doubt. Just like the Shaw Center. We'll land it for it. We need the space.

1:01:43 Unknown speaker not human verified

All right. Any more questions? All right. On the record, anybody have any objections to move this item to consent?

1:01:55 Unknown speaker not human verified

Hearing none, so moved. Item 6.7, discuss and consider future Board approval of annual course additions and deletions for the 2016-17 school year. Ms. Ward.

1:02:19 Unknown speaker not human verified

Good evening, President Griffin, members of the Board, and Mr. Fraley. Tonight we're bringing forward our annual course proposal and deletion for your consideration. It is a particular highlight for us in our world of curriculum and we think that we have a lot of courses to propose, very ambitious list here. We're very excited about it. With me tonight to help present I have Aline Lindley. She's the director of secondary curriculum and instruction as well as advanced academics and Dr. Sarah Martin who is the director of CTE in And you know both of these ladies as prominent ambassadors in our state and bring favorable recognition by way of student achievement to KTISD across the state and nationally. So I'm going to ask Mrs. Lindley to start first with the courses that we have for your consideration.

1:03:11 Unknown speaker not human verified

The first course on the list is AP Studio Art 3D Design. We already have students submitting 3D portfolios to College Board for evaluation for college credit and so this is a course would allow them to earn credit for that work and when they submit those portfolios and take those courses. We often do see that when students are taking the AP exam and we don't yet offer the course it's always a good idea to look at those courses and see if it might be something we can add to our slate.

1:03:45 Unknown speaker not human verified

The second course is multivariable calculus pre -AP.

1:03:48 Unknown speaker not human verified

This adds another level of mathematics for our most advanced math students. It is to be taken after our AP Calculus BC course, which is currently the highest level of mathematics that we offer. And then the third pre -AP or AP course is pre -AP Psychology.

1:04:08 Unknown speaker not human verified

This course would be a prerequisite for AP Psychology, and it will allow the AP curriculum to be spread over two semesters, so that our students are competing across the nation with other students that take this course year-long, as a year-long course, and this would allow them to do that and expand their understanding and make them much more prepared for those AP exams.

1:04:34 Unknown speaker not human verified

Additional courses include the independent study in journalism. This would be a fourth year option for those students involved in newspaper and yearbook giving them elective credit for continuing with that passion. The fifth course is Special Topics in Social Studies 1 Civic Engagement. This adds a course to the criminal justice program at Miller and allows a student to earn an additional half credit for part of this program and being involved more actively in the community as part of the civil the the criminal justice program.

1:05:15 Unknown speaker not human verified

And then the sixth course is the discrete mathematics course. We are recommending that discrete mathematics replace a course, topics in mathematics, which we are recommending it be deleted. Discrete math has designated state objectives. It covers similar topics to the topics in math course. And will be a course that because of the state objectives is much more acceptable by NCAA CAA for our student athletes.

1:05:48 Unknown speaker not human verified

The CTE courses that we bring forward to you are Agribusiness Management Marketing. It's an upper level ag course that brings together the management and marketing of agricultural sciences in an entrepreneurial spirit. Practicum of STEM, which will be offered exclusively at Miller Career and Technology Center. Courses serves as a capstone course for the engineering pathway which is started at the home campuses. Students study concepts of science, technology, engineering, and math and have the opportunity to intern within the industry. Practicum of architectural design again offered exclusively at Miller Career and Technology Center. Course serves as a capstone course for the architectural design pathway which is started at the home campuses. Students will study in-depth concepts of architectural design and have the opportunity to intern within the industry. Financial mathematics Mathematics, this course serves as a fourth year math course designed around financial literacy concepts. Career Prep II serves as an additional work study course for juniors and seniors, offers students the opportunity to gain credit for supervised on-the-job training. And additionally, I'd like to note that the Career and Technical Education Office continues to make CTE courses available to all of our students, as we have eliminated another four course fees for the 2016-17 school year. Those course fees eliminated will be in AgMex and Metal Technology, Ag Fabrication and Design, Practicum of Ag, and Architectural Design.

1:07:14 Unknown speaker not human verified

Those are the courses we have for your consideration. Do you have any questions for us?

1:07:20 Unknown speaker not human verified

Mr. President.

1:07:20 Charles Griffin not human verified

Ms. Fox.

1:07:21 Rebecca Fox not human verified

Thank you very much. Dr. Martin, did you say we're removing some of the fees? Yes, ma'am. Okay, that's great because that will give more students opportunities to be in those. I love that. Correct. Ms. Lindley, the courses you talked about are all very interesting. What kind of class size do you think that will be? Will we be able to meet minimum requirements for classroom enrollment? They seem, some of them, very specific.

1:07:46 Unknown speaker not human verified

The studio art is one that can be stacked with other art courses. That's really how those students are doing those 3D designs right now. The multivariable calculus, we have determined there are about 55, 60 students that would would be eligible for that course next year on a campus that has sufficient enrollment could offer it face-to-face and we're also considering designing a virtual component that could be taught to students at multiple campuses and then the pre-op psychology is a pretty vibrant course it's a very interesting course for students so we don't think that this will actually should enhance the capability of students to be able to approach that course because there's

1:08:23 Rebecca Fox not human verified

extended time to cover that content follow-up mr. president with our oh my goodness what's the word for the track that the students endorsements endorsements thank you the endorsements is I thought there was just so little room for these extra credits or electives I get on my words electives do Do we feel like there's enough interest and room in their schedules to be able to take these courses and have enough? Do we have the teachers already, and will we be able to keep them full? That's my basic question.

1:09:00 Charles Griffin not human verified

The way that we do the course proposals, it's generated nearly every course here has been generated from the campus by the teacher who has ideas of student interest in that course. And then we look at it to make sure it's not just representative of a single campus. Not every course proposal comes forward. We're looking at the ones that we think will be across several campuses.

1:09:24 Unknown speaker not human verified

Any other questions?

1:09:25 Rebecca Fox not human verified

Just one more follow-up.

1:09:26 Unknown speaker not human verified

Go ahead.

1:09:27 Rebecca Fox not human verified

I really like the STEM one at Miller and then right over to the Shaw Center, right? I mean, that just correlates so well. Please. Awesome. Awesome. Thank you.

1:09:37 Unknown speaker not human verified

I'd like to thank you for having a curriculum that's flexible, listens to the students, listens to the teachers, and engages. engages to me this one when you got kids engaged in things that are so far outside of traditional education that's Very impressive. Thank you for energizing our young minds. Thank you Item 6.8 discuss and consider future board approval and agreement for the purchase of attendance credits

1:10:07 Unknown speaker not human verified

it's oh I'm sorry any objection to move an item 6.7 to consent so moved go ahead

1:10:20 Lawrence Greer not human verified

sir good evening mr. Griffin board mr. Fraley this item tonight is for lack of a better term of going through a formality process and and kind of a waste of time. We are under the laws of the Texas Education Code 41.002. Our wealth per WADA is estimated by Texas Education Agency to exceed three hundred nineteen thousand five hundred dollars. So that would be our total property values of the entire district divided by our estimated weighted average daily attendance for this school year. And indeed I do think it will be over three $319,500. That is what is, that is the benchmark for us to be considered as a Chapter 41 school district. And we talked about this in our budget workshops, but we are far from being a, what everyone thinks of as a Chapter 41 school district. Our wealth would need to exceed $514,000 per weighted average daily attendance, or about a 55% more value we would have to have. That's an old benchmark used by the law and we are in TEA's eyes a faux Chapter 41 school district. So we still receive $150 million, $180 million in state funds. I don't expect that stopping anytime soon, but we are meeting the requirements of Chapter 41 by approving this agreement for the purchase of attendance credits.

1:11:55 Unknown speaker not human verified

Thank you.

1:11:56 Charles Griffin not human verified

Mr. Mahalsky.

1:11:57 Bryan Michalsky not human verified

Mr. Smith, is that just a function of the threshold to qualify for Chapter 41 just hasn't, or I guess the recapture amount is obvious, or the amount of wealth you need to get to the recapture is much greater than, is that just a function of they just haven't caught up that threshold up?

1:12:17 Lawrence Greer not human verified

It's an old outdated number at the 319-5 that hasn't been kept.

1:12:23 Bryan Michalsky not human verified

That's just a static number.

1:12:24 Lawrence Greer not human verified

Yes, sir. It's been static for I'm gonna guess eight to ten years

1:12:28 Bryan Michalsky not human verified

I'm guessing there's quite a few districts that are in that little gap there

1:12:32 Lawrence Greer not human verified

As I understand the majority of districts in the state are now doing this form of the same process Again, we are at we've been below for 12 years below state average in our total wealth per water We're writing at the state average now and we are doing this as well as many many other districts. I think I heard over over 900 districts are doing this out of the 1,100, and most districts are not subject to recapture.

1:12:59 Unknown speaker not human verified

Thank you.

1:13:01 Unknown speaker not human verified

Any other questions? Any objection to move this item to consent? So moved. Thank you. And 6.9.

1:13:09 Lawrence Greer not human verified

These next three items all deal with the state property tax code, and it requires that each entity, y'all being the KDISD Board of Education, entity contract with the local appraisal district to have a representative on the board of directors. This first item does that for the Fort Bend County Appraisal District. There are five candidates on there for five positions, and what we're recommending through the resolution that's attached is to vote for all five, splitting our votes equally at 129 votes each for the five candidates that you see listed there on your item agenda item

1:13:57 Unknown speaker not human verified

Thank you, this item is not going to be moved to consent. I have to read the resolution next week, but is there any questions? Thank you, sir The

1:14:10 Lawrence Greer not human verified

Next one is for Harris County a little different for Harris County as we are only given one vote all the school districts in Harris County that are represented in Harris County have one vote, regardless of the size of the district. Historically, or since 2006, Tony Trumbull has served as the school district's representative. This year, Tony, Catherine, or Tony Trumbull is running for the HCAD board, as well as David Yonda. I believe both of their resumes should be attached to your agenda item. them and we would need to cast a vote for one of those two candidates next week. Again Tony Trumbull has served and I'm looking here since 2006. Thank you. Any questions? All right sir and 6.11. The final county is Fort Bend County. KDISD's vote entitlement is 709 votes out of the 5,000. We are recommending our candidate, Rosamond Alexander, that all of our votes go to Mr. Alexander for Waller County.

1:15:25 Unknown speaker not human verified

Yeah, and just to re-clarify, 6.11 was for Waller County.

1:15:29 Lawrence Greer not human verified

Waller County.

1:15:30 Unknown speaker not human verified

All right, 6.12, discuss and consider future board approval of an order authorizing the issuance of Katy Independent School District's unlimited tax school building bonds in one or more series setting certain parameters for the bonds authorizing a price officer to approve the amount an interest rate price including the terms thereof and certain other procedures and provisions

1:15:53 Lawrence Greer not human verified

related there too okay I'm moving on you a little bit but I've got clearance I'm Lawrence Greer here from RBC Capital Markets, and then of course we have Rick Witte and Tonya Fisher with Andrews Kurth, our bond legal counsel is also here in attendance for any questions that you may have. But I'm just going to kick it off by saying it's that time where we're gearing up for our second of four bond sales for the 214 authorization. We had our first one, as you know, back in February. We priced those bonds on February the 2nd of 2015, and those bonds were delivered in March, and we're currently using those funds to pay for projects that are underway. With approval of the first item, we expect to be able to get moving forward with our rating calls so that sometime after the first of the year, or probably in early February, we would be able to price bonds again that would deliver cash or be delivered in March to continue our spending efforts on the programs, the construction that we have going. This bond sale, we anticipate to be about $260 million based on our cash flow models. We're asking for a parameter of a $275 million authorization in case the interest rates or the cash flow change and the needs change. But we do anticipate that sale being about $260 million. The other items that Mr. Greer is going to talk about is we were very successful last year in our refunding efforts. I mentioned that back in the budget process that I think I called it a home run, that we were able to hit home runs with the refundings and save about $39 million on refunding efforts. We weren't going to be that lucky this year, and we're not. I'll let you know that now. But we are eyeing some transactions that we do think will indeed save interest expense, fence and Mr. Greer is going to talk about those as well.

1:18:12 Unknown speaker not human verified

Good evening to Board President Griffin, members of the board, Superintendent Fraley. Again, my name is Cleary with RBC Capital Markets. I'm also locally here and been here for about a year now. I'm the parent of two proud special needs kids that you guys are doing a great job looking after. My daughter Gabrielle was originally a member of the and Schaefer and my son and Randolph. So phenomenal job. I'm just excited to hear all the good things you're doing. As a point of policy, this is just a continuation as we have some prepared materials. It's a pretty voluminous book here that we don't anticipate going through every page, but I just wanted to call the board's attention to page three right behind the table of contents that overviews the parameter. And just as Mr. Smith talked about, the new money authorization, maximum up to $275 million. And, you know, the other two board parameters contemplate, you know, giving the board the flexibility to execute a refunding. and previously you we've done this before back in June of this year we were able to you know give some flexibility just in case interest rates cooperated to save money what's different this time is it's a little different product where we've identified a some series of bonds that are not actually callable till like 12 months from now almost to the day and in fact there you can't lock in date lock in any savings until you know that time so there's an opportunity with a direct placement or private placement with a bank at Wells Fargo that we could you know using their cost of funds yeah but they would purchase the funds on their balance sheet and achieve savings upwards of 4% present value savings and And so one thing that we would recommend to the board is considering, you know, who knows where interest rates are going to be. You know, there's, when you look at different ways to lock in interest rates, there's obviously the public markets. But, you know, the public market alternative doesn't give rise to the flexibility and what the proposal that this one bank has put forth. forth. So our recommendation, I know on page three we looked at the present value savings on both the limited tax, you have some bonds that are limited tax, you have some bonds that are not unlimited tax. So the way the mechanics actually work, you would stay in a taxable mode for about a year and then it converts to a tax exempt mode 12 months from there. And so one thing that we would recommend in light of where rates are that not first 12 months at that taxable rate, we recommend that that savings threshold be adjusted from that 4% that you have here to the 2.5 just for one year, and then with the expectation that you have a conversion take place 12 months later. and we have a on page number and I'll get to on page number 14 when you look at the direct purchase kind of is it has an illustration of this type of transaction and the other districts and counties that have participated in Keller, Garland, Lamar, Arlington, Sakura, and we're able to lock in today's rate with the concept of rates probably going to be higher a year from now than they are today. We've looked at a break-even analysis. If rates are about 75 to 80 basis points higher, you're probably going to wish we would have locked in and had the opportunity to. And so this is not finished. We're still looking at it. This has only given us the flexibility to continue to study it. And I think if we all feel comfortable, we have your bond counsel here, and if we all feel comfortable with it, we would make the recommendation that we consider and bring it forth for the consent next week and move forward with it. But just because it's going to be adopted and perhaps moved to the consent agenda agenda doesn't necessarily mean we'll do the transaction. It just gives us the flexibility to continue to look at it and monitor the transaction. So that's the overview of the transaction. But notice though on page 14 what we want to do, Chris and I talked about last month. He asked me to say, you know, why don't you think, you know, do an overview of just the market itself. And we know that we really did a good job in terms of Chris and his leadership and his team given the flexibility we were able to kind of go back on you if you will lock in rates at a very low opportune time so on page five if you will you know kind of we what we want to do is kind of show you where we locked in rates about a year ago we said february the second we actually locked in the race and you can see where rates are today you know um you know you can see that it's it's amazing how volatile the markets are. And before we always typically come in and talk about why rates are low or high, but here on page five we're kind of giving you why the rates are becoming more volatile. And the reason why is because our market really is a function of U.S. Treasury markets. As you can see on page five how the U.S. Treasury is denoted in green and the M&B rate, which is a tax-exempt rate. So it's not, you see how correlated it is? And so it kind of moves lock and step, and that's what the history has been. And so what constitutes a strong market as it relates to where things are? And a strong market is actually when rates are actually moving lower. That's what hopefully, you know, rates kind of go back down. But the cycle is the expectation is rates are going to move higher. I think, you know, to the right we say, well, this is really a moderate or weak kind of market. We start talking about when U.S. Treasurer is kind of moving higher, investors are kind of reallocating their money, you know, kind of moving away from bond funds. We have a lot of people say, you know, I'm just going to wait for rates to move higher. So that's the kind of general theme. And then another thing that we're seeing is on page six is that some end investors, who who are investors, these are people who actually own the bonds, and they are moving those as a result of them moving from the bond funds to the stock funds. You can see the magnitude of the redemptions. Look at in 2013 how, you know, there was major draws, and they shifted money out of muni funds into other funds. And so we monitor that, and that also adds to what we call the volatility of what's going on in the current muni environment. And then lastly, you know, which is pretty amazing when you look at the supply of, you know, bonds being passed on page seven, the bond election summary, you know, since 2013, I mean, just this past November, there were 6.3 billion passed, you know, in terms of bond calendars, in terms of the, you know, on the electric. So since the last three years, over $24 billion has passed. The concern is you have so much supply. It's almost as if you're selling all of it at once. You have so much supply of paper coming over the next several years. And if investors remain skittish, that's going to cause some more, perhaps, volatility in the market just because you're going to probably have more deals than you have money available to purchase and to absorb. So those are the major factors, and obviously you have changes in regulations, all of which has created an environment where, you know, as a weatherman, I can't project that it's going to be, you know, cloudy, stormy, but I know it might be cloudy. And so I can't tell you exactly when interest rates are going to move higher, but chances are they might be moving higher. In contrast, there are certain parts of the market that are doing great. and so we're just kind of bracing you that the race that we did we were able to secure for you back in February you know it might be a little bit higher you know in the future and in speaking of the February we did a little case study on that right behind on page 15 that was a pretty interesting transaction because when you give us the parameter ability to go out and work with your staff and And we can contemplate a lot of different methods of sale. And the one that we chose last time was the negotiated sale, which gave us the flexibility to do all the preliminary work, get the information out. And on page 15, we were originally supposed to sell bonds on the 11th of February. And we noticed that interest rates were moving lower at the time, so we accelerated it and was trying to get into price on January 27th. And lo and behold, you can see on number four, a weather event happened, remember, on the northeast. The end investors, who are the end investors? We're talking about the money managers. They couldn't even get into the office. And so we delayed it again. And so, you know, that's the type of flexibility we were able to get. It was, again, a lot of heavy supply, other issuers coming into market. So we did something fairly unconventional. We were able to go to a pricing on Monday, a Monday late morning, early afternoon to kind of beat the heavy supply of what's going to happen during the week because the markets have effectively been closed for several days and was able to kind of almost pick the bottom. I'm not saying that negotiated sales can pick a bottom but by moving the date to the Monday versus work Just kind of leaving it at on the 11th say taxpayers about twelve and a half million dollars you know just an extra interest costs and That's that's just the flexibility and not to say that we're married to you know, we we think that one Method of sale is better than the other. It's just it matches the market with the volatility and so So that's one thing we want to kind of share with you. And we have some good other information in here about who your investors are, but I'll just stop there as it relates to the type of sale, where we were last year, what our prospects are, and entertain any questions that you have about just the market in general, method of sale, or just any parameters specifically about the refundings.

1:29:33 Charles Griffin not human verified

Mr. Adams.

1:29:38 Joe Adams not human verified

Mr. Greer, are you talking about new money or are you talking about refunding?

1:29:42 Unknown speaker not human verified

I was looking at the new money, yes, sir. On the February 2nd sale, we actually had two series where we sold $155 million new money, and then we also added $52 million in refundings. Yes, sir.

1:30:01 Joe Adams not human verified

I have a multitude of questions.

1:30:03 Unknown speaker not human verified

Go ahead, sir. You have the floor until somebody else raises their finger.

1:30:08 Joe Adams not human verified

We're talking about new money here of $275 million. Is that right, Chris? Yes, sir. Mr. Smith, I'm sorry.

1:30:15 Joe Adams not human verified

The question I have, I guess, would be for the administration would be, why do we need to sell $275 million right now as opposed to doing a delayed delivery on partial of this? and just kind of waiting to see what would happen.

1:30:39 Lawrence Greer not human verified

In the bond planning and our debt plan, we've been planning based on the cash flows that we work with and working with the construction department. We identified four times to sell, and we've had a lot of luck, and for some of the reasons that Clarence discussed earlier about the supply, the sale bonds early in In the year in in the January late January early February timeframe So we sold last year that gave us proceeds of 180 million dollars We felt that based on our cash flow model that would take us to this time till March of this next 2016 at that point based on our cash flow models. We will need cash again in March of 2017 and are planning a sale about that same size.

1:31:29 Unknown speaker not human verified

We don't sell all the bonds at

1:31:31 Lawrence Greer not human verified

once because as we talked with the bond community about at length we sell them as our tax as the as the community grows. So each year we're adding new homes new businesses and those kind of things and so we stair-step those sales and then to to have the growth or the value growth based on all the new construction to accompany that, and as well as we don't need all the funds at once. And so by doing that, that saves interest. We already have interest rate risk in which we're exposed to changes in the interest rate environment, but there's no reason to pay interest on monies that we don't need.

1:32:14 Joe Adams not human verified

You're saying that if it's $275 million, we would not sell the $275 immediately?

1:32:20 Lawrence Greer not human verified

We would sell the $275 the way we were looking at sometime in February, maybe like January or February. The bonds would be delivered to us sometime in the latter part of March. At that point, we'll need those funds because we'll be in the middle of these construction construction projects that will be drawing the funds at a rapid pace.

1:32:42 Joe Adams not human verified

So you will sell all of them at one time and we'll have that money. I guess what I'm looking for is when will you need that money?

1:32:53 Lawrence Greer not human verified

We'll need it in March.

1:32:54 Joe Adams not human verified

All of it?

1:32:55 Lawrence Greer not human verified

Yes. Not all of it. We'll need that amount over the next 12 months. That will last us 12 months. And we'll invest the monies that we're not spending, and we use that interest to go back into the debt service fund. That's one of our tool belts to control the tax rate. We use the interest off of that and put it right back into debt service.

1:33:18 Joe Adams not human verified

A couple questions. Mr. Greer, please.

1:33:22 Unknown speaker not human verified

Yes, sir.

1:33:23 Joe Adams not human verified

Did you inform KDISD that there was a competitive sales versus a negotiated sale opportunity?

1:33:32 Unknown speaker not human verified

Yes, sir. Sure. We talk about the method of sale in terms of what's the best, what would give KDISD and its taxpayers the best way to achieve the overall lowest cost of funds. And the one biggest difference between the competitive sale is that we have to predetermine the date and the time. And we post it, we let the investors know about it. And as we we stated in the case study, that time would have been February the 11th. And so, yeah, you can change the times on a competitive sale, but it's not as fluid, and you risk the chance of not having the investors follow you. And you may lose some of the bid participation. So it's just not a very fluid, it doesn't have the same degree of flexibility as a negotiated sale to just to really just get into the market really on a day's notice we had a sweet had a conversation like on a Friday and I know that following Monday we were in the market I could not have happened on a competitive sale we were looking at the volatility about a year ago and had the same very similar conversation so you know what gives the district the best chance to achieve the lowest cost of funds and you know not suggest that we can pick the bottom them again but you know instead of getting locked in on what the best price would have been on the 11th um which that could have been that may not have been the best we would have got the best deal but it probably might may not have been the best data price and and i think that's what

1:35:13 Joe Adams not human verified

the flexibility comes into play a competitive bid you can withdraw your bid though at any time

1:35:20 Unknown speaker not human verified

correct you can withdraw you in theory that absolutely right but that's rarely in practice is rarely done because it's very difficult to get that audience back again. You know, in terms of who the bidders are, the bidders on the competitive sale are the same underwriters that participate in a negotiated sale. So it's the same market. It's just how the means of access in that market. Yes, sir.

1:35:48 Joe Adams not human verified

In the, during the TASA-TASB convention, there was a presentation done by Aleph ISD regarding competitive versus fixed, or the negotiated, that's referring to. And based on those numbers, they pretty much sold me on the fact that competitive was the way to go. And because, I mean, if you look at, on average, just bear with me a minute. Yes, sir. These are some numbers here. But on average, there was a savings of about $2.7 million per $100 million of bonds sold.

1:36:34 Unknown speaker not human verified

Yes, sir.

1:36:35 Joe Adams not human verified

And so if you take that number, that's kind of a middle of the road right there. Yes, sir. So $2.7 million, and we're talking about $275 million. Right. That 2.75 times 2.75, I mean, you're talking some chunk of change here.

1:36:55 Unknown speaker not human verified

Yes, sir.

1:36:56 Joe Adams not human verified

Right? You're right. And so the – Let me finish here. Yes, sir. But it ranged as high as $6 million per $100 million. And, of course, a low of about $900,000. I guess the question is, you heard the people sitting here tonight talking to us and these board members here, we're all concerned about money. We're all concerned about getting the very, very, very best deal that we can possibly get, saving money, because we want to move it forward. And I'm one of those, too. These folks made a great example of that tonight, because I knew I was going to talk later, so I didn't talk much at that time. But we had people do it. But my concern, Mr. Greer, is the fact that we have not had a competitive bond sale since 2007 in this district. And that's when you came on board here. Mr. President, if I could speak also. Mr. Adams, Mr. Fahey.

1:37:50 Unknown speaker not human verified

I, too, go to a lot of conferences and we get a lot of presentations by districts or by their vendors. I don't know. I wasn't at this meeting with you, but I'm very satisfied with what we've gotten from RBC since 2007. We have celebrated the results we've gotten for us.

1:38:05 Joe Adams not human verified

You know, we have absolutely saved money.

1:38:08 Unknown speaker not human verified

We have indeed. And so if there is a better way he's pointed out the comparison between Negotiated sell compared to sales and we I got a letter just the other week from another firm Want to come in and do what you're at talking about? I don't know if they were with a leaf or not But I'm very careful about what we hear at a conference becoming what we do is in KDIC

1:38:25 Joe Adams not human verified

But I'm saying is that is that I've also I'm sure mr. Greer is aware of the government finance officers Association Yes, sir, and there's an independent, right? It's independent, but one of their recommendations is if you have a triple A rating that possibly you need to look at doing competitive sales.

1:38:45 Unknown speaker not human verified

You're absolutely right. We speak to that when you start looking at the competitive sale market in general because when you look at strong demand and there is a place for competitive in this market, it's looking at the marketplace in general. And part of it is when you look at the bank qualified market itself, you know, the trends, well, let's just start on page 19. You know, how often, we want to take a look at how often is each bond sale type. And just so, you know, we don't have a horse in the race and competitive negotiating. we're just whatever is the best method that produces the overall lowest cost is what we're for. And just kind of to answer one of the questions, 2008 was the credit crisis, and that caused a lot of changes in the whole market itself with banks. And so when you look at competitive since 2007, we actually had, to the right, you know about 13 percent of all deals were done um were competitive about 84 percent were negotiated about two percent was probably placed and today we have about 10 percent and about 88 negotiated and less than one percent privately placed in the in the current market and this is all school districts you know texas you know looking at it you know last 10 years and on the next page we looked at transactions you know over a hundred million dollars pay through twelve you know since 2006 and you can see by par you know we had about the majority of the deals over a hundred million for K through 12 you know have again the market has gone to negotiate it not to suggest that there's anything wrong with competitive but you know I think what happened in 2008 with the the credit crisis and it really caused a lot of disjointment in the market. And so, you know, that's where investors and that's where issuers wanted more control to say, you know, I want to make sure that I avoid a bad day in the market and give me the flexibility. And being able to move that day around like we were able to do in February was very, very helpful. Now, the flip side of the argument is, if you keep going, on page 21, the bank qualified market is on fire. You know, the bank qualified is a type of debt that, you know, carries special tax preference where the buyers are typically banks. They get a tax, basically a tax deduction, if you will, for buying the bonds. You can see back in 2006, that market was about $50 million. Now it's grown about tenfold. And so, and the reason why is because the demand is so great that you're going to probably get an outlier bid and you're going to be just fine. We don't. It's a little bit different. We don't, we're not seeing that type of level of engagement for the non-bank qualified transactions. And but, you know, you're exactly right. There's always, that's also, you know, that's a market that really lends itself more to competitive. And then another one is negotiate is notes. Right. And when you start talking about maturities less than one year, that note market, that should probably be a competitive sale. In fact, the last deal that we did, we typically have the first maturity go competitive. So we have a component of our negotiated deal have a competitive aspect to it where there's ample demand because it makes the most sense for kdisd and his taxpayers mr adams mr mahowski

1:42:50 Bryan Michalsky not human verified

um mr greer i guess since i've been on this board a little over three years now typically when you come to talk to us there is some good news we have saved taxpayers dollars uh real dollars here in this bill and a lot of that i know has to do with timing and i'm not sure if you're lucky or good but i suspect it's a little bit of both um but i do appreciate what your team brings to the table and um and and i know that and i have confidence that you have ktisd taxpayers interest in mind when you are going out to market on our behalf so i want to thank you

1:43:24 Unknown speaker not human verified

thank you and then and final thing is when we're doing a negotiated sale we have three opportunities to look at the market to make sure that you know what other comparable deals are being sold whether it's competitive and negotiated and and you tell a pre-selected group of underwriters you have to beat that deal and um and to end up the last sale about 35 million dollars of bonds did not have it in investors chris was very aggressive he he made those underwriters put it on their balance sheet, and took the risk off of KD taxpayers. You know, obviously the rates moved higher, which means that those banks lost a lot of money on the deal. But, you know, that's the commitment that, you know, that Chris has to hold the feet to the fire. And we were there with our underwriting desk saying, you know, you have to be the best deal. So we're looking at it three times in terms of surveying the market. Also, it's like an open book test, if you will. We see every competitive deal and negotiated deal, and they have to beat it. And before we move forward, we actually verify that and look for the comparables. Mr. Freddie?

1:44:38 Unknown speaker not human verified

Mr. Greer, could you look at page 14 of your document, please, where you have put a, not really a side-by-side, but it's a comparative statement regarding compared and negotiated, and you have under the comparative transaction, the end investor you have, the KDIC taxpayers and Texas residents crossed out.

1:44:54 Unknown speaker not human verified

Yes, sir.

1:44:55 Unknown speaker not human verified

Why is that?

1:44:55 Unknown speaker not human verified

So on a negotiated sale, we were able to give KD taxpayers the priority to put in orders and their orders to be filled first. And in fact, we had about $300,000 worth of orders. And then in the Texas residents, they are given a second priority. And we had about $5 million worth of orders there. On a competitive sale, it's primarily institutions. So those are not marketed to. they buy them in the secondary market. And so that's just a function of the market.

1:45:29 Unknown speaker not human verified

What you're saying, though, is that there's a benefit to KDIC taxpayers and Texas residents by having it negotiated up front as what's required.

1:45:37 Unknown speaker not human verified

Yes, sir.

1:45:38 Unknown speaker not human verified

Is there a way to put that into space for competitive bid? It's not like an RFP, is it?

1:45:42 Unknown speaker not human verified

No, no, sir, because what we're doing, what we're asking on a competitive deal, what we're asking to do, asking the investment community to do, is we're inviting them to submit a bid. There's no obligation to do anything. And so if interest rates are moving very violently, and like you saw, there's $27 billion of bond elections passed over the last three years, a lot of supply. We want to make sure, everyone knows KDIC's name, but we want to make sure, why not make sure we can control the output or influence it as much as possible? The negotiation helps you do that with, let's see if members of the community won't, you know, like to purchase the bonds at the market level. What about Texas residents? Let's give them the priority first. And let's let them buy the bonds without any type of markup or excessive commission. And that's what you'll find typically in a competitive. Now, having said that, if interest rates start moving lower, trending lower, just like the bank qualified market, market, we would be standing here saying, you know what, let's do a competitive sale. But with the volatility that we're seeing, the Fed saying they may come in and increase rates, it just gives you a little bit more flexibility and the negotiated sale has historically has given you more flexibility.

1:47:06 Unknown speaker not human verified

Just last thing. So you're not saying that one is necessarily better than the other just out of hand, it's just that my experience is in our basic needs, one's benefited us more than the other would have benefited us.

1:47:15 Unknown speaker not human verified

Right. It's about matching that one methodology with the market. And if the market was very directional, like the faint qualified market is currently, we would be saying let's do a competitive sale immediately. But chances are, most times when we're seeing bonds sold, they're not all being sold. And so we know that the capital requirements of the end users as well as the bidders are fairly limited. and there's a limited amount of capital and let's be first and get that you know tell our story and secure the capital let's not leave it you know the market may not be as strong for just an invitation to create to create a bid because just because you get three beers doesn't necessarily mean that's you know the market that's the market at the time and and and and we're not saying one is better than the other we're just trying to say that you know we have to match it with the right, the appropriate market. And it appears that there's more volatility to negotiate it may work better. And then also you have some refund, you have some very structured, some sophisticated structures that more, you know, lends themselves a little bit better to the negotiated market because you have different terms, not standard.

1:48:32 Unknown speaker not human verified

Thanks, sir.

1:48:33 Joe Adams not human verified

Would you say that an underwriter would make more money in a competitive bid or a negotiated bid?

1:48:49 Unknown speaker not human verified

You know, that's a great question. That's a great question. And I talked to my underwriter. We're very active in competitive and negotiated market as a firm. And because of the risk premium that you're building in, you're paying a little higher, actually, gross spread. You know, we may call it different. But when you start talking about the funds that you actually pay, in today's market because of the risk premium. I know, at least for our firm, at least, we're charging a little bit more on a competitive. We're building a wider growth spread, if you will, because of the volatility.

1:49:24 Unknown speaker not human verified

Mr. Adams, how many more questions do you have so we can?

1:49:27 Joe Adams not human verified

I've just got a couple. I think this is important.

1:49:32 Joe Adams not human verified

The other thing I'd like to ask you about is that I think that, you know, In the past year, there's been like $34 billion worth of bond sales, over $100 million. They've all been successful and all have been sold. The thing I have, and you talk about this, and the competitive bid, of course, I'm still of the opinion that the competitive bids are going to come in a little lower than negotiated bids. But when you look at a term over 30 years, it's like a house payment. It's going to amount to a lot of money. and based on that plus the amount for your underwriters and what they get, I think that it could be a chunk of change. Now, one final question and I'll finish. Of the refunding, does this give you authority to refund all of our bonds that we have outstanding? Right.

1:50:28 Unknown speaker not human verified

Right. So as a point of policy, we put in a pool of your portfolio, but they all don't work. And so, yes, we already have, there's parameters outstanding that allows under the right market conditions for us to work with your staff to secure savings on all of your debt outstanding.

1:50:53 Joe Adams not human verified

Now, having said that. I'd like to see that come back to the board before we do that. I mean, I know that you are you the officer, Mr. Smith, that does that. I mean, does it make sense that we as a board see that? If I could point out, I believe the board does authorize the parameters and approve the standards.

1:51:13 Unknown speaker not human verified

Maybe we ought to look at the policy on that.

1:51:16 Unknown speaker not human verified

Right. And so that's where I was going. So the policy, you know, that the staff has adopted is we want to make sure that advanced refunding provides a certain level of savings. And so while the parameter might give the flexibility, just in case, just like we had it, you know, market events over the weekend, sometimes that triggers what we call a flight to quality trade where investors, they dump all their stock investments, and then they put it all in bonds and causes the U.S. Treasury 10-year to go lower. And as it goes lower, you know, that creates an opportunity for you to refinance. finance and it doesn't stay there but it's just an opportunity and so for the last several years as a point of policy you know we've represented that you know it may make sense to is to give every you know look at all the candidates and so when interest rates move lower it will be will be in the position to to act and did save taxpayers money because those windows of opportunity are very narrow they don't they're not these don't remain open as far as I can speak in plain english basically what you're saying is that this board takes action to set those parameters then you have that within those parameters set by the board that's good you can't go outside those parameters yeah the parameters are already set right we have to see i think it was four percent savings in fact you know that was on page number

1:52:42 Unknown speaker not human verified

um actually i think you may advance my question okay thank you mr smith we periodically get get audited and we're given numerous awards the process that you're going through here is that being reflected and looked at as part of the reasons that you've received such outstanding marks on these appraisals one of the more

1:53:08 Lawrence Greer not human verified

detailed portions of our of our audit is our debt note and our debt note is very complicated and of course we have that audited and we actually review that probably the most and so when we do send it off to the GFOA and ASBO we do always get a comment about it but it's nothing negative they just they point out something that they noticed in reading the report thank you so you're fairly

1:53:36 Unknown speaker not human verified

cut that process you're fairly confident that what we're doing is about the best value that we can be doing to work with the money that we're given.

1:53:48 Lawrence Greer not human verified

There's a staff that works daily and I know to try to get the best bang for the buck that we can. And there may be multiple ways to do things, but we're doing the best we can with the information that we're provided to save taxpayers taxpayers or do the best investment for AISD patrons and taxpayers.

1:54:13 Unknown speaker not human verified

Thank you, sir. You answered my question.

1:54:17 Joe Adams not human verified

Mr. Griffin, there's no question on my behalf about the staff and the way they operate.

1:54:27 Joe Adams not human verified

There absolutely is not. I'm looking out for the district and trying to save money just like we were with Mr. McElwain and his buildings. buildings. I think these are questions. We got this information on Thursday. I haven't had time to, there's only a little bit of time that we can ask questions here about that. My purpose of this is to ask Mr. Greer, which he comes prepared to do that. That's his job to do that.

1:54:55 Unknown speaker not human verified

If it wasn't, then he wouldn't be our financial advisor.

1:55:00 Joe Adams not human verified

Yes, sir. I take it you got all your questions answered? Not all of them, but I think that maybe I can submit the rest of them.

1:55:08 Unknown speaker not human verified

Thank you. All right.

1:55:13 Unknown speaker not human verified

I'm about to ask if we can move this to consent. If the answer is yes, this order will be moved to consent agenda as I have read it. Is there any objection to move this item to consent?

1:55:26 Bryan Michalsky not human verified

Which items? I think there's multiple.

1:55:28 Unknown speaker not human verified

Is there multiple? Just 6.12. two we still have to do six point one three six point one four what you object okay six point two will not be moved to the consent agenda six point one three this is an actual order discussing consider future board approval of an order authorizing the issuance of Katie Independent School District unlimited tax refunding bonds convertible direct purchase bonds appointing a price officer and delegating the price officer the authority to approve the section of the bonds to be refunded the sale of the bonds and the terms of the bonds establishing certain parameters for the approval of such matters by the pricing officers approving the use of an escrow agreement and paying agent register agreement loving an annual ad valorem tax for the payment of the bonds and enacting other provisions relating to the subject mr smith

1:56:28 Unknown speaker not human verified

mr rear 6.13 yeah um yeah that was the conversation we've had about i'm sorry i think

1:56:37 Unknown speaker not human verified

yeah we can't move that one to consent but this is just another order we did that was 6.12 and this is 6.13

1:56:51 Unknown speaker not human verified

I believe they discussed all. They discussed them? Yeah, we discussed. Yeah. All right. Thank you very much. Then let me read 6. All right, first of all, 6.13. Mr. Adams, do you object to sending this one to the consent agenda? Okay. 6.14? All right. Neither 6.13, 6.14, or 1.2 will be moved to consent. moving to 6.15 discussing consider the future board approved the annual review of investment policies and strategies

1:57:49 Unknown speaker not human verified

Yes, ma'am.

1:57:51 Unknown speaker not human verified

Good evening, President Griffin, Superintendent Fraley, and Board of Trustees.

1:58:00 Unknown speaker not human verified

All right, 6.15, discuss and consider. This is the review of the investment policies and strategies. So, the Public Funds Investment Act requires that the Board review policy and strategies by fund type, approve brokers and approve investment pools, and authorize training resources. CDA Legal summarizes the major topics of the Public Fund Investment Act, and CDA Local is our more restrictive KDISD investment policy. C.D.A. Legal describes all authorized investments, whereas C.D.A. Local refines that list for KDISD to include U.S. government treasuries like bills, notes, and bonds, as well as agencies and GSEs, bonds, as well as CDs, pre-purchase agreements, commercial paper, and no-load money market mutual funds, as well as the investment pools authorized in code. Our quarterly reports meet compliance with the PFIA Public Fund Investment Act by reflecting the market monitoring of security ratings, book values, market values, accrued interest, and specific maturity dates where applicable. CDA local was last changed by TASB update in July earlier of this year. No changes are recommended in conjunction with this report. Policy and strategies by fund type are very similar and consistent with prudent non-speculative investment focused on safety and preservation of principle and also focused on liquidity. for the general operating fund preservation of safety and liquidity to provide up to 24 months of cash flow with securities not to exceed three years. Special revenue funds and agency funds, preservation of safety and principle with maturity sufficient to meet anticipated cash flows. Debt service funds, sufficient investments liquidity to meet debt service obligations according to bond documentation. And capital project funds, sufficient investment liquidity to meet capital project obligations, also not to exceed three years. In compliance with PFIA, brokers and investment pools must sign a certification acknowledging their reading and therefore their understanding of Katie's investment policies. Each broker and firm is assigned a unique CDR number, and we are able to check on brokerage firms and brokers through FINRA by running their CDR numbers members to investigate their past history. Brokers and firms who express interest in KDIDSD and interest in providing us relevant market information and who are in good standing and who return the completed certification documentation are included in the broker list presented to you in this report tonight. Although we receive information and investment opportunities from the firms on this list, we currently have no direct security purchased. This is due to our relationship with Prosperity Bank. Prosperity continues to provide us competitive rates in a collateralized manner as well as continued valuable customer service. Note that that collateral limit is up to $500 million now as of September this year. Yes, we do maintain some balances and investment pools. Finally, with regard to approved training resources, district investment officers, CFO Christopher Smith and business manager Ann Feitinger and director of budget and treasury Sherry Butterfield are required to take a minimum of 10 hours every two years to remain compliant. client. This list of training resources is varied enough to provide several applicable avenues to complete PFIA training requirements. The final page of your investment policy review includes an investment summary for 2015, and that was an expedited summary of CDA legal and local. I'd be happy to answer any questions. Mr. Adams.

2:02:41 Joe Adams not human verified

Thank you, Ms. Butterfield. Just a quick question here for you. I noticed on our brokers authorized to engage in investment transactions, there's clearly an omission of some companies here that I just want to ask you about. Folks like Bank of America, Merrill Lynch, Morgan Stanley, J.P. Morgan. Why would they not be included in this?

2:03:05 Unknown speaker not human verified

Okay. Bank of America Merrill Lynch was previously on our approved broker-dealer list, and they asked to be removed. They are no longer servicing public funds in that manner. You said J.P. Morgan, and what was the other one?

2:03:25 Joe Adams not human verified

Morgan Stanley.

2:03:26 Unknown speaker not human verified

Morgan Stanley. Morgan Stanley. Okay, J.P. Morgan. JP Morgan did not return any paperwork and Morgan Stanley hmm I guess they have not expressed an interest in servicing our investment side all right thank you ma'am how can a brokers make this list and when do they have to apply they simply need to contact one of the investment officers and express an interest. Typically if somebody contacts Chris or Ann and usually I'm the funnel for those kind of things. I keep a running list anybody who's expressed interest from year to year and then when it's time for this report and this presentation in October I'll send out emails to them and say it's time. You need to have your compliance officers and yourself sign the certification documentation return your cdr numbers so you we can run those finra reports and that's it you just follow the follow the directions and you're in then that's that's kind of the way

2:04:36 Unknown speaker not human verified

that goes thank you any other questions any objection to move this item to consent so move to us ma'am 6.16 discussing consider future board approval of grant ratifications okay i'm going to

2:04:50 Lawrence Greer not human verified

to let Sherry catch her breath and in accordance with the county guidelines we ratify the district our participation in grants in June we bought the first round which were the majority of our grants that we bring each year and then November throughout the year as needed we bring some some smaller list and tonight you have four grants in front of you four of which are activity type grants physical education are running for Hudson Elementary and Morton Ranch Elementary and then we have the non educational community based support which is the big one for $40,000 and that provides for special needs students families respite services such as transportation case management and

2:05:37 Unknown speaker not human verified

social work in their homes questions any objection to move this item consent so So moved. And Mrs. Butterfield, you get the last one, 6.17, discuss and consider future board approval of the November 2015 budget amendments.

2:05:54 Unknown speaker not human verified

Yes, thank you. There are seven amendments for your consideration tonight, and we're touching a lot of different things, so I'll try and expedite this as well. But there is $400,000 worth of construction fund amendment for the UPS retrofit funded from project savings in the $459 million authorization, as well as $2.4 million portion of the Memorial Parkway Junior High renovations. The TURS expenditure budget is amended by $1,058,000 to upgrade and replace the video display and ancillary equipment with all of the video related to the Merrill Center. The food service expenditure budget is increased by $442,597 for kitchen renovations, also at Memorial Parkway Junior High. And in the general operating fund, we have two amendments that increase expenditures, one in the amount of $120,678 related to equipment and supplies to support a new grounds crew, And then $111,223. This is rebudgeting startup funds for Tompkins High School. This is their year to add the 12th grade, and this will be their final year of startup supply budget. Other amendments are direct offsets between different functions of existing budget.

2:07:36 Unknown speaker not human verified

You know, what's funny on that amendment is, you know, people talk about our yards and sometimes they want to mode more often and less and then not and when people ask me what is a yard crew cost I think I'm going to point to your amendment and say that's what it costs to get these yards mode I'm sorry this equipment are there any other questions any objection to move in this item to consent so moved section 7 we have miss Courtney dual that's going to give us a quick brief on the attendance that you went to the beam and as board members we get don't get to ask any questions we just get to listen

2:08:25 Unknown speaker not human verified

I did attend another BEAM meeting and it was a gathering of the different committees and we had a speaker, his name was Eric Bostic. You all got your book tonight and I still contend that they were put in the wrong envelopes for a reason. He was very much on the mindset of us transforming this district based on our BEAM initiative, which is because everyone's attitude matters. He made us all get up. We couldn't sit down. It was a very interactive Friday morning. It was very early. But he's a motivational speaker, and he had us running around this room like a bunch of crazy people, giving high fives and things like that but basically it was just to encourage us that our attitude starts with us individually and then it spreads to leadership in the schools and then not only on an adult level but as well as on a student level so he spoke with students shortly after meeting with us and that it's something that if we all take ownership in he his big thing is is I'm awesome and he wants to each encourage somebody that we work with, somebody that we're close to, maybe a student or whatever, that they're awesome and that they can make a difference and attitudes can change. It was just basically that BEAM initiative can start with one person and it can start with one person's attitude, maybe letting somebody else know that they're awesome that day. And I thought the most interesting part of the whole thing is he made us all stand in a circle And he began kind of digging and asking really simple questions like if you're a male step forward Okay, all the men stepped forward if you're a female and then he got a little deeper and he was like if you struggled in school step forward If you come from divorce step forward and it was amazing in in the group The different people that you were kind of like wow really and he kept digging and he kept digging and basically what he was getting to is everybody has something in common. We all have struggles. We all have things in common, but at the end of the day, our attitude can change any outcome, and it starts with us, the leaders in this district, and then it trickles down to the students in this district, and then it goes back to our vision, which is what legacy are we leaving in this district, and that is that our attitude matters, and with a positive attitude and an attitude of gratefulness, we can change lives, and that's what we're here to do.

2:11:11 Unknown speaker not human verified

Thank you very much.

2:11:12 Unknown speaker not human verified

You're so welcome.

2:11:13 Unknown speaker not human verified

And I wish we could ask questions, but we're not. That moves us to eight future meetings. A regular board meeting is scheduled Monday, November 23, 2015, and this meeting is adjourned at 933.