State Tech Regents at a special meeting last Tuesday, March 29, changed banking institutions, selecting First State Community Bank of Farmington to complete the deal at an interest rate of 3.07% over the 20-year, $13 million loan to provide the bulk of necessary funding for State Tech to build a new clubhouse and complete other upgrades at the Osage Country Club. Regents will finalize the deal at an April 11 meeting.

State Tech President Dr. Shawn Strong said that after UMB Bank was selected in March, a term sheet was submitted and a closing date set. However, the college was informed that UMB Bank would not service the loan.

“This has nothing to do with State Tech’s credit or our financial position,” said Dr. Strong.

Regents removed UMB Bank as the bond purchaser and named First State Community Bank, which submitted the second-best proposal last month. The bank will provide $10 million in 2022 and $3 million next year, a split that will benefit the college by lowering the interest rate .02%, which is estimated to save State Tech about $22,000 over the life of the loan. With two loans, however, the school will pay $15,000 to Gilmore Bell, which handles bonds for the college.

State Tech’s Student Government Association leadership voted to impose a $15 per credit hour fee to assist with the project, which will generate approximately $875,000 per year. 

“That’s enough to cover the note,” said Dr. Strong.

An additional $1 million will be required to fund the budgeted $14 million project.

The budget for the driving range and the construction of the new Commercial Turf & Grounds (CT&G) building is $3.5 million, bringing the grand total for both projects to $17.5 million, of which $13 million will be financed by First State Community.