The Swanton Local School District recently completed a refinancing of their 2006 School Improvement Refunding Bonds. The bonds were originally issued to construct a new high school and provided for the improvements of various school facilities, approved by voters in November of 2000.
The refunding process, similar to refinancing a home loan to take advantage of lower interest rates, will save more than $675,000 over the remaining life of the bonds. Joyce Kinsman, district CFO/Treasurer, began working with Rockmill Financial Consulting, municipal advisor, earlier this summer on the refinancing. On Aug. 21, the district concluded their efforts by issuing $5,940,000 of Refunding Bonds to refinance the previous bonds.
A combination of low interest rates, good credit, and perfect market timing not only allowed the district to save a significant amount of interest, it also allowed the district to shorten the term of the bond issue by one year.
“The board is always looking for ways to save, and wisely spend, the money our tax payers have entrusted us with and we felt reducing the number of years the community would have to pay for the bonds was an easy decision,” said Steve Brehmer, board of education president.
The overall savings is well beyond the district’s initial expectations. Many school districts target a savings of 2 to 3 percent of the amount to be refinanced. In Swanton’s case, the savings equaled 8.89 percent. The 2006 bonds had a rate of 4.08 percent. The new rate on the 2015 Series Refunding issue is 2.26 percent.
“We are always looking at opportunities to save as much money as possible” said Kinsman.
Emily Cannon, Director at Rockmill Financial, credited the district’s administration for its excellent financial position and fiscal practices for the opportunity to lock in such a low rate.
“Joyce Kinsman, Superintendent Jeff Schlade, and the board have taken great strides in assuring stability in the district’s current financial position and have demonstrated that they are exceptional stewards of taxpayer’s dollars,” said Cannon. “Taking advantage of this savings opportunity is yet another example of their prudent financial management of the district.”
For additional information please contact District CFO/Treasurer Joyce Kinsman at 419-826-7575.