Mo. Audit Finds Schools Could Do More to Save Taxpayer Money

3 years 4 months 1 week ago November 13, 2013 Nov 13, 2013 Wednesday, November 13 2013 Wednesday, November 13, 2013 2:54:00 PM CST in News
By: Nick Thompson, KOMU 8 Reporter
loading

JEFFERSON CITY - KOMU 8 News reviewed State Auditor Tom Schweich's report on school bond issues Wednesday and found some Mid-Missouri districts have not used a competitive process in issuing bonds that could save taxpayers money.

Schweich analyzed more than 500 bond issues in the state over a four-year period and released his report Tuesday.

Schweich found from 2008-2011 an average of 88 percent of Missouri's local government bond issues were sold through a process known as a "negotiated sale."

In the process, local government entities select an underwriter, who serves as a middleman between them and investors. In a negotiated sale, the underwriter often acts as the financial advisor who helps structure the bond issue.

Schweich said negotiated sales often present a conflict of interest because the underwriter has an incentive to sell the bonds at a high interest rate to attract investors. The school district's interest lies with keeping interest rates low to keep borrowing costs low.

Brent Ghan of the Missouri School Boards Association told KOMU 8 News Wednesday education officials are not finance experts, and often seek the financial advice of underwriters on bond issues.

 Ghan said some districts may be content with their bonding policies.

"It has worked well for them and their local school districts and they really haven't seen the urgency to change their policy on this," Ghan said. "But this audit may be another point where it's being brought to their attention again and they may be reconsidering their policies."

Schweich called for more local government entities to use a competitive bidding process. In a competitive bond sale, underwriters submit sealed bids for the bonds and the firm with the lowest cost bid wins.

Schweich's audit found Missouri local governments could have saved taxpayers $43 million in the four-year period if they would have utilized more competitive bidding.

"Many local government officials lack an understanding of the bond issuance process and expertise to evaluate and negotiate bond pricing proposals," Schweich wrote in his report.

From 2008-2011, Columbia Public Schools used the competitive bidding process four times and used a negotiated sale once. Community Relations Director Michelle Baumstark told KOMU 8 News the negotiated sale was a better deal than a competitive bid when it was used.

Baumstark said because the district has a large and qualified finance staff, it is able to make sound decisions to get the lowest interest rates.

According to Schweich's report, the following Mid-Missouri school districts used a negotiated sale for bond issues from 2008-2011:

- Boonville R-I School District

- Brookfield R-III School District

- Camdenton R-III School District

- Eldon R-I School District

- Hallsville R-IV School District

- Harrisburg R-VIII School District

- Higbee R-VIII School District

- Marceline R-V School District

- Maries County R-I School District

- Moberly School District No. 81

- Moniteau County R-I School District

- Moniteau County R-VI School District of Tipton

- New Bloomfield R-III School District

- North Callaway County R-I School District

- Osage County R-II School District

- Pettis County R-V School District

More News

Grid
List
COLUMBIA -- One person is dead and two others are injured after a shooting that occurred Sunday afternoon, according to... More >>
1 hour ago March 26, 2017 Mar 26, 2017 Sunday, March 26 2017 Sunday, March 26, 2017 4:18:00 PM CDT in Continuous News
COLUMBIA - During his time as athletic director at the University of Missouri Mike Alden oversaw a little bit of... More >>
3 hours ago March 26, 2017 Mar 26, 2017 Sunday, March 26 2017 Sunday, March 26, 2017 2:35:00 PM CDT in Sports
ST. LOUIS (AP) — About 1,000 of St. Louis' delinquent properties are expected to face the wrecking ball to create... More >>
4 hours ago March 26, 2017 Mar 26, 2017 Sunday, March 26 2017 Sunday, March 26, 2017 1:13:10 PM CDT in News
OZARK, Mo . (AP) — A southwestern Missouri man is accused of sexual misconduct involving a teenager who investigators say... More >>
5 hours ago March 26, 2017 Mar 26, 2017 Sunday, March 26 2017 Sunday, March 26, 2017 12:20:00 PM CDT in Continuous News
FORSYTH, Mo . (AP) — Authorities said a southern Missouri man told investigators he was either sleepwalking or dreaming when... More >>
7 hours ago March 26, 2017 Mar 26, 2017 Sunday, March 26 2017 Sunday, March 26, 2017 10:25:00 AM CDT in News
COLUMBIA - Officers said a suspect is on the run after a robbery at an Extended Stay America Saturday night.... More >>
19 hours ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 10:39:11 PM CDT in News
COLUMBIA - A hearing for Sturgeon Police Chief Greg Halderman will take place on Monday. On the week of... More >>
22 hours ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 7:16:00 PM CDT in News
LINN - State Technical College in Linn opened up its campus to recruit prospective students and to show off what... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 4:49:00 PM CDT in News
COLUMBIA - The Boone County Fire Protection District said Saturday it is conducting a search and rescue at the Katfish... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 4:37:00 PM CDT in News
ST. LOUIS (AP) — Two men each are jailed on $750,000 bond after being accused in connection with the St.... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 3:38:00 PM CDT in News
COLUMBIA - Two semi trucks and two cars were part of a wreck Saturday that closed westbound I-70. The... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 3:23:00 PM CDT in Top Stories
JEFFERSON CITY, Mo. (AP) — The Republican-led Missouri Legislature will get back to a business-friendly agenda when it returns from... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 12:35:00 PM CDT in News
ST. LOUIS (AP) — A St. Louis man has been sentenced to life in prison without the possibility of parole... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 10:54:00 AM CDT in News
CLAYTON, Mo. (AP) — An activist who helped shut down a St. Louis-area freeway during protests commemorating the first anniversary... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 10:45:00 AM CDT in News
ST. LOUIS (AP) — St. Louis police say a 15-year-old boy was killed and six other people were critically wounded... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 10:41:00 AM CDT in News
COLUMBIA – A group of local artists hosted a fundraiser Friday night, giving people people the chance to view works... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 5:40:00 AM CDT in News
COLUMBIA – Columbia businesses are coming together to encourage community members to lead healthy and balanced lives. Keystone Chiropractic... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 5:28:00 AM CDT in News
OVERLAND PARK, Kan. (AP) — Officials in a Kansas City suburb where a fire destroyed a multimillion-dollar apartment building under... More >>
1 day ago March 25, 2017 Mar 25, 2017 Saturday, March 25 2017 Saturday, March 25, 2017 4:30:30 AM CDT in News
Columbia, MO
Broken Clouds 57°
6pm 59°
7pm 59°
8pm 57°
9pm 56°

Select a station to view its upcoming schedule:

Coming Up Next

2:00p
PGA Tour Golf
6:00p
Little Big Shots
7:00p
Little Big Shots
4:00p
La Bamba
6:00p
Mystic Pizza
8:00p
Marvel's Agents of S.H.I.E.L.D.

Tonight's Schedule

7:00p
Little Big Shots
8:00p
Chicago Justice
9:00p
Shades of Blue
6:00p
Mystic Pizza
8:00p
Marvel's Agents of S.H.I.E.L.D.
9:00p
KOMU 8 News @ Nine on The CW
9:30p
Seinfeld