Financial instruments known as Time Warrants have been available to Texas public schools since 1995, however their flexibility for use in construction projects was limited due to their $500,000 maximum loan amounts and terms that were restricted to no more than five years. Now that’s all changed, thanks to the efforts of Southlake, Texas-based Government Capital Corporation and the Texas Rural Education Association.
Effective September 1, 2013, the legislature passed House Bill 2610 which dramatically improved the efficiencies of using Time Warrant financing by expanding the terms up to 15 years and increasing the maximum loan amounts to $1 million. This means that school districts that have a need for capital improvement projects can supplement their available cash balances with Time Warrant financing, eliminating the need to obtain additional voter approved bonds.
How does this affect Ramtech? This will provide an additional opportunity for us to provide cost effective and flexible school facilities using our Accelerated Building System permanent modular construction approach or relocatable modular buildings. In the past, districts were forced to either get new bond approval or utilize their existing surplus cash balances.
Unfortunately for many rural school districts, neither of these options were usually feasible. Working together, Ramtech and Government Capital (a leading public finance company that has provided Texas schools with flexible financing options since 1992) can now provide low cost, high quality school additions that are financed through these expanded Time Warrants. This means for example, that a typical four, six, or eight classroom wing to an existing campus could be purchased without going through the lengthy process of a bond election or using up a school district’s existing cash balance.
Ramtech also makes it easy to initiate the process by generating at no cost to the district (and prior to entering into a contract) preliminary documents that include a floor plan, site plan, color rendering, and design/construction budget, together with a proposal for financing the project through Government Capital. This alternative provides a faster, less costly approach to the design, construction, and financing for permanent construction and relocatable buildings available to Texas Public Schools.