Board picks Sandman for open seat

Longtime Cloquet school board member Nate Sandman was appointed to fill the vacant seat on the school board Monday.

The vacancy was created by the election of former school board member Sarah Plante Buhs to the Carlton County Board of Commissioners District 1, with two years left in her school board term.

Sandman - who hadn't filed to run again after eight years on the board, the past two as board chairman - was one of six people who applied.

Current board members Hawk Huard, Dave Battaglia and Melissa Juntunen and two newly elected board members, Nichole Diver and LeAnn Butler, interviewed the six men on Dec. 16, but did not announce the choice until Monday's meeting. The applicants included Ted Lammi, Jason Loons, Brendon McKeon, Robert Peacock and Shaun Williams.

"The decision by our group of five was to offer the appointment to Nate Sandman," Battaglia said Monday. He previously told the Pine Knot that the group of candidates was very good, with "a number that will make very good school board members, hopefully someday."

Sandman said he applied because he wasn't sure anyone would after only two people filed for three open board seats in the General Election. Sandman said "yes" to the appointment when Cary called him Monday night.

"I'm still going to bring leadership and consistency and knowledge to the board after serving eight years," he said. "I'll be able to pick up right away."

Even with the appointment of Sandman, the Cloquet school board remains in flux - largely because Sandman won't officially take office until the Feb. 10 meeting.

Because three of the four board members present had to be sworn in Monday and Hawk Huard was absent, Dave Battaglia was automatically appointed acting chairman. Once reelected board member Melissa Juntunen and new board members Nichole Diver and LeAnn Butler were sworn in, the board voted unanimously to wait until the February meeting to elect board officers for the year (appointing acting officers for one month). They also postponed "adopting" schools and most committee appointments until February. There were two exceptions for committees meeting between now and Feb. 10: Diver volunteered to serve on the Local Indian Education Committee (LIEC) and Butler will serve on the equity committee.

Money saved

Board members also unanimously approved a bond sale that will refinance bonds sold in 2015 to pay for the construction of the new Cloquet Middle School.

Matthew Hammer, a senior municipal and school district advisor with Ehlers, Inc., said the financial advisor received 12 bids and was pleased with the results. The low bid was Bank of Omaha. Hammer said the bid will save the district - actually taxpayers and the state of Minnesota - $2.4 million (versus the previous bond sale) over a 10-year period.

"It will mean about $230,000 lower each year for Cloquet taxpayers, and the state," he said.

Hammer explained that $38 million of the original $41 million bond sale was "refundable," but the sale was structured so the principal on the new bonds will be only $34.9 million, with just over $3 million paid up front by the investor. The 5-percent interest rate works out to a 3.23-percent "true" interest rate because the district will use the $3 million to pay down the loan amount, Cary explained.

Hammer also liked the deal because the district could refinance the remaining debt in another eight years, potentially saving even more money.

"When we get there, we'll essentially have paid down about $22 million of this current bond," Cary said. "There will still be $12 million left to potentially refinance if conditions are better."

While the Cloquet school district again received an A rating from Moody's, Hammer warned that the credit rating agency noted "a little deterioration" of the district's fund balance along with a number of strengths.

Superintendent Michael Cary explained the district - and many other Minnesota schools - has overspent its budget slightly for many years, as state funding has not kept up with inflation.

"The fact that our fund balance continues to shrink is pushing us towards the edge of maybe getting a worse rating," Cary said, explaining that a worse rating would increase the cost of future borrowing. "We are getting to the point where we have to be very conscious about protecting the current fund balance."

The district business office and administration is starting work on next year's budget now.

Also Monday

• Board members voted to not raise board compensation from its current level of $300 per month (for the two regular meetings) plus $85 and mileage for committee meetings.

• Board meetings were set for the usual second and fourth Mondays except for July and December, when the board will meet on the second Monday only. Additionally, the board will meet on Tuesday, May 27, because of the Memorial Day holiday the day before.

• Student representatives took a seat at the board meeting for the first time since the Covid-19 pandemic. Seniors Wyatt Preteau and Emilie Mattinen reported on upcoming events at the high school. A larger group of students will take turns attending board meetings.