Bond refinance at East Grand School District poised to save taxpayers
A bond refinance at the East Grand School District is poised to save taxpayers more than $770,000 during the life of the financing.
Taking advantage of interest rates that are “at their lowest point since 1967,” according to RBC Capital Markets Director Dan O’Connell, Denver, taxpayers are benefiting from more than a 10 percent savings on a large portion of its 2004 bond issuance.
Voters passed the issuance of $9.8 million, with an interest rate of 4.94 percent, in a 2004 bond election for roof repairs, replacing the transportation facility in Granby, drainage improvements, expansion of Granby Elementary School for preschool and kindergarten classes, renovations at Middle Park High School, and abatement of asbestos and demolition of the old high school/middle school.
With the new interest rate of 2.25 percent on a total $6.52 million that was refinanced out of the $9.8 million, taxpayers should save about $59,000 a year until the bonds mature in 2024, O’Connell said.
“It was a great job by the (East Grand School District) board,” he said. “We shelved this for a year and came back and the savings went through the roof.”
The board followed government recommendations and held off on refinancing until it was justified with more than a 3 percent savings. The board passed a resolution authorizing pricing of the bond in advance back in April of 2010 in order to “catch the market and capture the low interest rates to generate significant savings to the district,” O’Connell said.
In total, with bond counsel, underwriters, RBC and rating fees, as well as other miscellaneous costs, the cost to refinance was $97,000, a cost factored into the $770,000 in long-term savings.
The district now has outstanding principle debt service of $33.6 million from a 2004 refinance on 1998 bonds for building the middle school, the remaining 2004 bond amount outside of what was just refinanced, and more than an $18 million issuance in 2007 for improvements to buildings at Granby Elementary, the high school and the Fraser Elementary, as well as more projects at all the schools using premiums generated by the bonds.
– Tonya Bina can be reached at 970-887-3334 ext. 19603
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Editor’s note: The following letter to the community was submitted to the Sky-Hi News by Winter Park Mayor Nick Kutrumbos.