H-BC bond sale yields better-than-expected results, taxpayer savings

Hills-Beaver Creek School Board met in special session Monday night to review the result of an $8.035 million bond refinance.
Matthew Hammer, a municipal advisor with Ehlers Inc. of Roseville, delivered the results of the Monday’s bond sale to the board.
“We have good news,” He said. “This is really, really good.”
Six companies expressed interest in refinancing the district’s debt.
Hammer said interest was high because the refinance was considered low risk and the underlying credit rating given to the H-BC district by Standard and Poors was an “A+/Stable.”
The credit rating took in account elements outside the district’s control such as enrollment history and the community’s economic base.
“It (the district credit rating) is an attribution to the decisions made by the board and the administration making sure overall that what can be controlled in the district can be controlled and being controlled well from a financial perspective,” Hammer said.
Interest rates from Monday’s bond refinance sale ranged from 2.1045 to 2.3118 percent.
Northland Securities of Minneapolis submitted the lowest interest bid.
H-BC board members authorized the refinance of the bond at the new lower rate.
The 2.1 percent replaces the original 4 percent interest rate that at the bond’s maturity in 2036 would have climbed to 4.250 percent. The new interest rate reaches 2.250 in 2036.
With interest at almost half its original rate, the district taxpayers save $1.569 million in interest costs, an additional $100,000 more than anticipated in August.
The district expects to spend almost $100,000 less on debt under the new 2021 to 2036 bond payment schedule.
Instead of $725,000 a year, debt payments drop to $626,000 for the next 15 years under the new debt service schedule.
“It’s going to be a huge win for us,” said board member Dan LaRock.