Bac minutes 02 28 15 03 21 15

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Meeting minutes, February 28, 2015 Location and time: Fulton Branch, Cleveland Public Library, 3:15 p.m.

Commissioners present: Alfonso Sanchez, Donald Brown, Nancy Schuster, Eric Paszt, Peter van Dijk, Robert Jackson; Absent: Diane Downing Chairman Sanchez called the meeting to order.

Commissioners unanimously approved the meeting minutes for the January 24, 2015, public meeting.

Administrator James Darr distributed copies of the BAC Conflict of Interest Policy and Annual State of Understanding relating to the Policy for each Commissioner to sign.

Reports: Master Plan revision BAC Administrator James Darr presented the oral report. CMSD is holding 13 "open houses" around the district to explain its Master Plan proposal, which was unveiled Feb. 24 at the Board of Education meeting. Mr. Darr distributed the proposed roster of construction projects for Segments 6-9 and of proposed locally funded repair, improvement, and maintenance projects from 2015 through 2019.

BAC members were encouraged to attend the open houses, which conclude March 24. The Board of Education is being asked to approve the Plan, including any modifications made as a result of community input at the open houses, at its March 26 meeting. Commissioner Schuster commented that the timeline does not give the Board very much time to react to input from the community. $200 million bond issue Mr. Darr presented the oral report. The Board of Education on Feb. 24 authorized the CMSD Administration to proceed with issuance of $200 million in bonds, made possible by voter approval of Issue 4 on the November 2014 ballot. Board !1

Chair Denise Link and Board member Anne Bingham recused themselves from the vote to avoid possible conflicts of interest. Ms. Link is employed by PNC Bank, and Ms. Bingham is employed by Fifth Third Bank. Fifth Third serves as the District's Financial Advisor. The bond transaction will be a "negotiated" sale via underwriters selected by the District on the basis of RFP evaluations. The District selected RBC Capital Markets as the lead underwiter, and the comanagers were selected as PNC Capital Markets; KeyBank Capital Markets; Stifel, Nicolaus & Co.; and Loop Capital Markets. In response to a question, Mr. Darr said he did not know the fee split among the selected underwriters but would find out. He also said he would request underwriter-evaluation scoring data..........The deal may include Qualified School Construction Bonds, which permit a rebate to the District of most of the interest costs. Mr. Darr said that in the past, the District has funneled these rebates into its operating fund rather than back into its construction or repair funds. The result, because QSCBs are taxable and so carry higher interest rates, that Issue 14 taxpayers actually paid more to pay off the debt than they would have if normal tax-exempt municipal bonds had been issued. Mr. Darr repeated his recommendation that if QSCBs are part of the planned issue, that the construction or repair funds receive at least part of the federal interest rebate. ....... The anticipated sale date for the bonds is in late April.

New Business Commissioners unanimously approved an employment agreement with Mr. Darr for his services as Administrator.

Executive Session The Commissioners went into Executive Session for the purpose of discussing matters pertaining to personnel and possible litigation.

Adjournment After Commissioner reconvened the public meeting, they adjourned the meeting about 4:30 p.m.

Meeting minutes, March 21, 2015 Location and time: Fulton Branch, Cleveland Public Library, 1:00 p.m.

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Commissioners present: Alfonso Sanchez, Nancy Schuster, Robert Jackson; Absent: Donald Brown, Eric Paszt, Peter van Dijk.

Chairman Sanchez called the meeting to order.

Reports E-rate: Missed opportunity Commissioners briefly discussed the report, which outlines the District's failure to date to recoup more than $8 million in technology costs that had been available through the federal government's E-rate program. Commissioners expressed a desire to compile a timeline of significant events and deadlines in the District's dealings with the E-rate program. They also noted an email to the BAC from District CEO Eric Gordon, which said in part, "This report has revealed a serious problem.. .... I assure you that we will fully investigate our entire E-rate program to ensure that the proper controls are in place for our current and future E-rate applications." Commissioners questioned whether the pledge to investigate extended to the District's past and ostensibly closed applications, noting that depending on what occurred, the District may be able to recover some money from E-rate or from contractors and others.

Discussion Master Plan revision BAC Administrator James Darr presented a draft of Master Plan Update 19 / Enrollment-based analysis of K-8 construction needs and District plans. The discussion focused on plans to build more school space in some areas than the BAC's enrollmentbased projections indicated will be needed. Commissioners expressed a desire for some revisions, chiefly an introduction, improved summary and better graphic labeling. (This was done, and the revised report was released on March 23, 2015.)

BAC funding Mr. Darr outlined the BAC's financial status, stating that without a renewal of the BAC's three-year subsidy by the District at the Board of Education's March 26 meeting and prompt issuance of a check for the first year's installment, the BAC would technically run out of money by the end of the month but might be able to meet the April 15 payroll by spending its health-care reimbursement contingency.

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Commissioner adjourned the meeting about 3 p.m.

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