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UPDATED: FSA Can Make Payments on Construction Bond

Fulton Science Academy's Angela Lassetter says Wells Fargo's demand is in attorneys' hands now. A payment agreement, new investor or selling the land for the proposed building are some possible solutions.

UPDATE June 28, 5:30 p.m.: Fulton Science Academy Board of Governors member Angela Lassetter said today the schools can pay back the $18.9 million in bonds.

Lassetter spoke about FSA's future as a private school, a school system audit report and her school's investigation and response to that report in an interview this afternoon.

Wells Fargo Bank, the bond investor, sent out a "Notice of Acceleration" on June 25 by certified mail to the Development Authority and the three schools involved: Fulton Science Academy (middle school), Fulton Sunshine Academy (elementary school) and Fulton Educational Services (Fulton Science Academy High School).

The bank's notice, sent by Virginia Anne Housum, a vice president for Wells Fargo, said the borrowers have breached the loan agreement, which puts the schools in default. The trustee demanded immediate payment of the $18.9 million bonds and interest by June 27.

Lassetter said the issue is in the hands of legal counsel now. She said several solutions are possible:

  • An agreement could be made with the investors over the bonds that may not include the soon-to-be private school.
  • FSA could sell the land on Fanfare Way intended for the new building planned for construction with the bond issue. Lassetter said the 44 acres is worth two to three times the almost $6 million of bond money that's been spent on grading, bond attorneys and design. Grading the land has prepared it for construction, making it a more valuable property, she said.
  • An investor could buy the property and still build a school on it, leasing it to FSA and the others schools for use.
  • Or another investor might come along and buy the bonds, setting up a repayment agreement with FSA and its partner schools–Fulton Sunshine Academy and Fulton Science Academy High School. This last solution would be ideal, because the school could still be built, she said.

"Part of the bond agreement required that we get a charter," Lassetter said. Local and state charter denial put the school in default.

Although the Alpharetta Development Authority approved the bond sale, this demand has no affect on the city.

"With respect to the Development Authority, a move by the investors to call the bonds has absolutely no impact on that body, the City, or our citizens.  By law the debt on the bonds is not an obligation of any of these parties and is solely the responsibility of the FSA schools," said James Drinkard, Alpharetta assistant city administrator.

He doesn't expect any changes in how the Development Authority proceeds with future bond applications. It's the responsibility of the involved underwriters and banks as well as the rating agency(s) that rate the issue to perform due diligence on the bond applicant. The Development Authority's due diligence is limited to is limited to ensuring that the intended use of the bonds is consistent with what's allowed under law and that it advances the economic development goals of the community, he said.

during mid-May and now bondbuyers are asking for the bond to be paid back. The school had .

The demand comes after months of complications for, which failed to get either a or a .

In the May BusinessWire release, Fitch said that lack of management cooperation left it unable to determine if the was feasible and its possible effects on the Fulton Sunshine Academy and . All three schools are obligated for the bonds.

Check back with Patch for updates to this story soon.

For related stories, see:

Julie June 28, 2012 at 08:41 PM
Terry you are wasting your breath. Everyone who reads these blogs knows that "Mark"(whoever he/she really is) never addresses facts. I am sure that before this blog runs it's course "Mark" will keep posting the same gibberish. I am not sure what religious faith "Mark" professes to (if any), but I know it is not Christian (as I am) or Jewish as many of my friends are as our faith would not condone writing such as "his". Maybe one day "Mark" will become enlightened.
MarkMunoz June 29, 2012 at 12:46 AM
THere they go, having an emotional meltdown on the comment board. So lets say someone is paying me? (Paranoid much?) Who or whom would be paying me? To tell the truth and expose your flaky group (yes flaky and rejects) I woluld do it for free any day. Truth is the best defense but unfortunately your "group" Terry/ Julie whoever you are. I love the way you guys act like Jews, Hispanics, etc., Oh Julie I am very very enlighted especially about Hocaefendis "Pearls of Wisdom" and how your schools are patterned after this. All of your lip service is a waste of your time, it is your actions and behaviors that put you into your current situation. No amount of cruising comment boards, slamming online voting like "Great Schools" etc., will save you. If following a 5th grade educated Imam who is in self-imposed exile is being "enlightened" then our children really are in danger from your group. You shouldn't be allowed near children. Kudos to the majority of the parents who will NOT be returning next year - that is if you actually manage to open as a private school. Don't think your Bank who is going to be your new owner will allow it. So what are you guys plotting next? Going to sue the State of Georgia? Like Texas is doing to get more money? or the County Schools like your sister School in Mass. Chesapeak Point Academy? Go ahead you will really earn brownie points for further attacks on American governmental structures. Pay back the loan!!!
MarkMunoz June 29, 2012 at 12:49 AM
Roswell Parent; It's too bad you cannot move beyond the fact you were denied a charter (for good cause) You need to get over this and move on.
MarkMunoz June 29, 2012 at 12:59 AM
No Julie you guys are wasting your breath. Address the charges, correct the mistakes answer to the questions on questionable expenses. THe town may forgive you. Keep up the same behaviors and they will scorn you and your private school (if it opens) Don't be a bunch of deadbeats pay the money back.
MarkMunoz June 29, 2012 at 01:04 AM
Terry posted "Face it, you don't like Turkish people, plain and simple.." No I don't like liars and those that cannot assume accountability for their actions. I also don't like the arrogance of this group who believe Americans cannot function unless they have a Turkish ran education system because they know best what is right for us? Turkey? A country with 78 million population, 14 million are illiterate. They have over 2,000 a day dropping out of schools. Not to mention Turkey always performs below standard on the OCED Rankings. Above other 3rd world countries like Chile and Mexico. I love Turkey, especially at Thanksgiving. .

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