Students from William T. Dwyer High School’s Finance Academy witnessed first–hand a transaction of $115 million Tuesday morning, completed through a bidding process that involved some of the largest banking institutions in the world. In a few years, some Dwyer alumni may be joining their ranks.
James Goughary, a senior at Dwyer, has plans on pursuing an M.B.A. and really valued this experience. “It’s a tremendous opportunity to see transactions this large. I got to see deals at Velocity, but not with numbers this big,” said Goughary, who just completed a summer internship in August with Velocity Community Credit Union in Palm Beach Gardens.
A Tax Anticipation Note, or TAN, is the financial mechanism to borrow money that school districts often use to cover payroll and other general fund expenditures until property tax revenues collected in November and December are available. The sale itself is done as an online auction with all participants submitting their bids by a specified deadline. The money received, in order to pay the bills, will be deposited in October and paid back by August 2018.
During the presentation, topics like credit and job market outlook for these current seniors were covered by the District Financial Advisor, PFM, and other guest speakers. Students were able to interact with professionals, as well as participate on a conference call directly from the trading desk of JPMorgan in New York to give an overview of market conditions and answer questions from the students.
The transaction of $115 million certainly comes across as a lot of money. However, for context, the School District has obligations to payroll and other benefits that exceed $60 million every two weeks. The opportunity for these seniors to get a glimpse behind the financial curtain, however, may have been priceless.
Marlene Pierre, a senior at Dwyer, was paired with one of the professionals to prepare a sample bid for the District’s TAN proposal. The student simulation occurred as the actual sale happened in real time, projected on screens for all students to see. Pierre said that although life in complex finance may not be something that she chooses to pursue, perhaps favoring a career in medicine, this experience may very well help her with her own personal finance down the road.
Wells Fargo Relationship Manager Stephen Lenehan, who mentored Pierre’s group, has participated in this program for five years. “I grew up in Connecticut and we never had any of these academies,” Lenehan said. “It’s a great opportunity for these kids to see how the School District and public finance are all intertwined.”