Jackson board to vote on refinancing of bonds

An opportunity to save as much as $400,000 has officials in the Jackson School District considering the possibility of a bond refinance.

At tonight's school board meeting, board members will vote on a resolution to refinance a bond series originally passed in 1996 for the construction of South Elementary School and additions to Jackson High School and North Elementary.

"It comes down to paying less money," said superintendent Dr. Ron Anderson. "We want to save taxpayers as much money as we can."

Anderson said the process is similar to a homeowner refinancing a mortgage at a lower interest rate.

Refinancing will allow the school district to pay less money over the lifetime of the bond, which is set to expire in 2016.

During that time, district officials expect to save around $400,000 in interest payments. However, it may be a few years before those savings kick in because of the cost incurred with refinancing, Anderson said.

The 1996 bond was refinanced once before, in 1998, at a net savings of $336,000.

In 2002-03, the district spent nearly $1.4 million on payments for bonds issued in 1993, 1996 and 2000. The 1993 bond series, which was used to build Jackson Middle School, was refinanced in 2002 at a net savings of $210,000.

Greg Bricker, senior vice president with George K. Baum & Co., a Kansas City-based company that provides bond consultation to the Jackson School District, said the interest rate market is the lowest it's been in 50 years.

He attributed the record low rates to a low inflation rate and slow economic growth, and said the interest rates on school bonds are the lowest he's seen in the 17 years he has worked with school districts.

"You can't say this very often, but this is a no-lose proposition for school districts," Bricker said. "Their bond payments are smaller and there are no identifiable ramifications to refinancing."

cclark@semissourian.com

335-6611, extension 128