Scottsbluff Public Schools will pay back $29.2 million general obligation bond a year early, despite the sharp economic downturn resulting from COVID-19.
Director of Finance Marianne Carlson said the district was able to refinance part of the bond, which was split in two. Carlson also said the early repayment would not require an additional levy.
“The district is committed to being good stewards of the taxpayers’ dollars and to that end, we continually watch the interest rates and explore whether refinancing is an option throughout the year,” Carlson told the Star-Herald over email.
Carlson attributed the $3.64 million in savings to lower interest rates.
The $29 million bond was passed by voters in 2014 and was used to remodel and renovate Scottsbluff High School.
The bond’s refinancing has been something of a roller coaster for the district.
In March, just days before the coronavirus pandemic contracted swaths of the U.S. economy and began its deadly rampage across North America, Carlson told the board that the district could expect $3 million in savings.
“I was a little broken when it went away,” Andy Forney, vice president public finance banker for D.A. Davidson & Co, told the Board on Monday. Forney co-presented the refinancing announcement with Carlson.
By April, Carlson and the district were watching the market for a new refinancing.
It worked out well for the district, which will save an additional $640,000 compared to the March refinancing.
“It’s a good thing we waited,” Forney said.
The $29 million bond was split into two bond issuances, according to Carlson. One bond was worth $20 million, while the other was worth $9 million.
The $9 million bond can be refinanced in 2021. Forney said that there could be $200,000 in savings there, depending on the market.