Goodrich-By a 7-0 vote on Monday night the school board OK’d a resolution to refund the 2006 bonds.
On Nov. 23, 2015, the Board of Education adopted an authorizing resolution by a 7-0 vote to refund the 2006 bonds. A notice of sale was published on Jan. 11 with bids due on Jan 25. The bond sale was held on Jan. 25. and the district received three bids. The investment bank of R.W. Baird was the winning bid for the district bonds.
‘Similar to the bonds refunded in 2015 it’s a huge vote of confidence for the school district,? said Michelle Imbrunone, district superintendent.
‘The three bidders were impressed with the long term fiscal responsibility of the district and the proactive approach to debt the board had taken. It’s a win-win for the taxpayers who will now save more than $2 million. The outlook for the district was excellent and the bond rating increased.?
Cost avoidance to the taxpayers for interest due is $1,088,173. There is an additional estimated cost avoidance to the taxpayers of $1,096,570 in interest expense in the School Bond Loan Fund. In total, this refunding provides an estimated cost avoidance of $2,184,744 to the taxpayers, according to a statement by Imbrunone.
The SBLF was established in the State Constitution and implemented by state law so all K?12 school districts such as Goodrich have the option of applying to the state to have their upcoming debt ‘qualified.?
According to the Michigan Department of Education, if for any reason a school does not make principal and interest payments on the bonds, the state is required to lend it the amount of the shortfall. Thus, the state guarantees the qualified debt of a local school district and a district can then borrow under the state’s credit rating. Also, if a school district levies the required maximum mills for debt service, it has the option of borrowing the additional amount needed for annual debt service directly from the state. This interest-bearing loan must be fully repaid after the bonds have matured.
In February 2015 refunding of the 2000 and 2005 bonds saved the district more than $3 million.