FOR IMMEDIATE RELEASE
November 16, 2006
MAYOR BLOOMBERG AND BEAR, STEARNS & CO. COMPLETE SALE AND TRANSFER OF $650 MILLION IN SCHOOL BONDS FOR NEW YORK CITY
$650 Million Will Be Used to Fund the Department of Education's Five-Year Capital Construction Plan, Creating 66,000 Classroom Seats Across the City
First in a Series of School Bond Sales - Underwritten by Bear, Stearns & Co. - Will Be Repaid With Aid Payments From New York State Agreed Upon in April
Mayor Michael R. Bloomberg and Bear, Stearns & Co. today completed the sale and transfer of $650 million in New York State-financed school bonds, the first state-funded installment towards the Department of Education's (DOE) Five-Year Capital Construction Plan. Under legislation passed by the New York State Legislature and signed by Governor George E. Pataki in April, the New York City Transitional Finance Authority (TFA) was authorized to finance up to $4.7 billion in bonds, backed by State funds. Today's sale of TFA Building Aid Revenue Bonds is the first under this innovative structure. The proceeds of the bond sale will be used to pay for the construction of 66,000 classroom seats and the renovation of school facilities as laid out in the DOE Capital Plan. Combined with already created seats from 2003 to 2005, the Administration will have provided nearly 106,000 classroom seats across the City, alleviating pockets of overcrowding and reducing class size. Bear, Stearns & Co. served as the book-running senior managing underwriter on the bond sale which closed today. Mayor Bloomberg was joined by Bear, Stearns & Co. Senior Managing Directors Dan Keating and Kym Arnone, City Council Speaker Christine Quinn, City Comptroller William C. Thompson, Jr., Deputy Mayor Dennis Walcott, Schools Chancellor Joel I. Klein, School Construction Authority President Sharon L. Greenberger, United Federation of Teachers President Randi Weingarten and Director of the City's Office of Management and Budget Mark Page for the announcement today at the Bear, Stearns & Co. World Headquarters in Manhattan.
"The sale of today's bonds marks a victory for schoolchildren across New York City," said Mayor Bloomberg. "This is the first step to ensuring that over the next three years, 66,000 classroom seats and 107 new school buildings are built so that our more than 1.1 million schoolchildren have the educational facilities they need and deserve. These projects are a crucial element of our public school reform. As we continue strengthening our curriculum, supporting our teachers, establishing accountability from top to bottom, and raising standards across the system, we must also make sure that our students have the first-class learning facilities they need to reach their full potential. We are building for our future - the future of our children and ultimately, the future of New York City."
"Today's bond sale is a critical step toward creating the high-quality facilities our students deserve," said Chancellor Klein. "It will help us build new schools, science labs, libraries, arts facilities and athletic fields where New York City schoolchildren will learn and thrive for generations. We are literally changing what public education in New York City looks like."
"Today marks a great victory for New York City and our 1.1 million kids in public schools," said Council Speaker Christine Quinn. "We now have the means to move forward in our five year plan to lower class sizes, to create libraries and science labs, and to provide our children with an education that will make them the leaders for a new generation."
"Bear Stearns was founded in New York City in 1923 and for the past 83 years we have been proud to call this city our home," said Dan Keating, Bear, Stearns & Co. Senior Managing Director and Head of Public Finance. "Throughout our history, our commitment to the City has remained steadfast. In 2001, in the wake of 9/11 we led the financing to help raise money for the City's rebuilding effort. This latest partnership is equally monumental. This money will help ensure the strength of the city's schools for generations to come."
Today's bond sale transaction caps one of the City's most significant victories in the last legislative session in Albany, securing state capital construction funds for New York City's schoolchildren. In April, Governor Pataki announced that the State would provide its share of New York City's $13.1 billion School Capital Construction Plan. Governor Pataki signed the legislation providing $1.8 billion in aid and authorizing an additional $4.7 billion in financing through the New York City Transitional Finance Authority. Yesterday, the Dormitory Authority of the State of New York issued bonds to provide $790 million of the $1.8 billion in grants to the City. Today, an additional influx of $650 million from the bond sale will added to funding for the DOE Capital Plan.
"This is a great step forward to address New York City's long-term education needs," said Comptroller Thompson. "Today's announcement shows our commitment to seeking innovative ways to ensure that New York City schools can be the best that they can be."
"Since full funding for the Capital Construction Plan was announced in April, we have been working aggressively to complete design projects and site schools," said SCA President Greenberger. "Today's bond sale secures our ability to continue to move forward aggressively toward the goals of the capital plan."
"It's remarkable that this has gone from vision to reality in a matter of months. That, in itself, is testimony to how important this is to all of our 1.1 million public school children, their parents and their educators," said UFT President Weingarten. "Given the dedication of our unionized construction trades, there is no doubt these first-class facilities will be ready as soon as is humanly possible."
The combined State and City school construction financing for New York City will be used for the modernization and expansion of City schools as laid out in the Department of Education's Five-Year Capital Construction Plan which was announced in November 2003.The capital plan calls for the construction of a total of 107 new school buildings with 66,000 school seats. The plan includes more than $4 billion for existing facilities, including exterior and interior building upgrades, mandated programs and other necessary repairs.
Stu Loeser/Virginia Lam (212) 788-2958
David Cantor (Department of Education)
Ray Orlando (Office of Management and Budget)
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