District 50 refinances bonds
Plateau Valley School District 50 plans to pay off a series of 2004 bonds as soon as 2018 following a refinancing of the bonds this week.
Plateau Valley’s School Board voted Jan. 18 to allow the district to refinance the bonds, which were issued in 2004 to pay for $3.9 million in construction at the district’s centralized school site in Collbran. The bonds were issued with an interest rate of 4.96 percent. After re-entering the bond market and refinancing this Wednesday, the district was able to secure a 2.06 percent interest rate.
The new rate will save District 50 property taxpayers an estimated $220,000, according to Superintendent Greg Randall.
Randall said taxpayers will not notice an immediate change on their property tax bills. The district will continue to collect the maximum $355,000 it is allowed to collect to pay off the bonds each year. The district plans to use the new interest rate to pay off the bonds six years sooner than the original 20-year deadline.
“The bottom line is it will save the taxpayers dollars in the end,” Randall said.
Randall said a financial adviser who helps the district with decisions about its bonds called him this fall to say the district should consider refinancing under new, lower interest rates. The School Board asked Randall and the district’s budget director, Linda Rau, to look into the idea.
When the two told the board the district could save a projected $140,000, an estimate the district ended up surpassing, the board directed the district to refinance.
The bonds paid for locker rooms, a gym, an auditorium and other additions at the school. Randall said the new amenities have helped give the district more space for graduation and drama productions and allowed sports teams to practice at the same time.
He added the bond refinancing will save taxpayers money but the district will not see a savings.
He said the district plans to either use reserve funds or make budget cuts for 2012-13 because he anticipates the state and local education funding formula will not provide enough money to keep the district at its current funding levels next year.