Below is a compilation of recently posted EMMA disclosures over the past week for a selection of distressed municipal borrowers with less than $30 million of outstanding long-term debt, which typically fall outside of Reorg’s coverage universe.Twin Cities German Immersion SchoolIssue Details: Series 2013A,
Series 2013B,
Series 2019Annual Report CertificationsConference Call Slides
The Twin Cities German Immersion School, a charter school in St. Paul, Minn., which is the obligor of $15.13 million in lease revenue bonds, posted its debt service coverage covenant certification for the 2022 fiscal year. The school had a DSCR of 0.92x, falling below its covenant requirement, though the school did meet its liquidity covenant. According to an end-of-year disclosure call, failure to meet the covenant was unexpected, as the school had budgeted a 1.01x DSCR and did not anticipate missing it when it was doing monthly reviews during the fiscal year. The school has budgeted to miss its DSCR covenant for the 2022-2023 school year because of an increased need for staff and higher class sizes as students are put on a waitlist. It anticipates meeting its covenant in the 2023-2024 school years because of optimized staffing and increased out-of-school programming revenue.
Generations at Shalom ParkIssue DetailsNotice of Cessation of Plans
The CEO of The Generations at Shalom Park, a planned senior living community in Charlotte that is the obligor of $12.95 million in Series 2019 revenue anticipation bonds issued by the Public Finance Authority, posted on EMMA that plans to develop the facility were being canceled. The notice cited the Covid-19 pandemic and its resulting economic effects, such as high inflation, as factors for not going through with the project. The borrower had previously missed several milestone covenants, and although bondholders had waived the covenants, funds from the bonds had been depleted to the point where the project was no longer considered feasible.
ENCORE LearningIssue DetailsNotice of Nonrenewal of Charter
ENCORE Academy, a New Orleans charter school which is the obligor of $11.13 million Series 2021A tax-exempt revenue bonds and $415,000 of Series 2021B taxable revenue bonds, posted a notice to EMMA that it lost a renewal of its charter. The school first posted a notice of the loss of its charter on Dec. 2, and since then, the Orleans Parish School Board declined to listen to the school’s appeal for a renewal. ENCORE Learning is currently searching for a replacement charter operator to lease its facility starting on July 1, 2023.
Sauk Valley Student Housing Project LLCIssue DetailsNotice of Final Distribution
BOK Financial, the trustee for $2.2 million of Series 2013 bonds issued by the Quad Cities Regional Economic Development Authority for the Sauk Valley Student Housing Project in Dixon, Ill., posted a notice of final distribution of $89,798.12 to bondholders on EMMA. This follows the dismissal of a lawsuit by a committee of bondholders against the trustee. The project filed for chapter 7 bankruptcy in 2016 after financial difficulties and was sold in 2018 for $620,000.