The Washington Court House City School (WCHCS) District has refinanced outstanding bond issues for a significant savings to district taxpayers, according to district officials.
According to WCHCS Treasurer/CFO Becky Mullins, in October, the district “refinanced its outstanding Various Purpose School Improvement Unlimited Tax General Obligation Refunding Bonds, Series 2013 and Series 2014.”
“Similar to a homeowner’s mortgage, the district regularly checks its debt and current interest rates to determine if refinancing is a worthwhile option,” said Mullins. “The district worked with Dinsmore & Shohl, LLP, the district’s bond counsel, and Fifth Third Securities, Inc., the district’s underwriter, to take advantage of the low interest rate climate and refinance these bond issues.”
The amount of the new bond issue is $10,406,018. The total savings to district taxpayers is $933,338, which resulted from locking in a lower interest rate of 1.65% as well as achieving economies of scale by combining the two issues to refund at the same time, according to Mullins.
“These savings will be realized in the form of reduced taxes needed to repay the district’s debt,” she said.
In addition to the debt service savings, the district’s 2021 bond issue has a final maturity of Dec. 1, 2032, which is one year earlier than the original final maturity date.
“This is not the first time the district has utilized this strategy to lower interest cost to the taxpayers. Refundings of the original 2005 bond issue for new classroom facilities, which provided the funding to build four new instructional buildings in the district, were completed in both 2013 and 2014,” said Mullins.
The savings from the 2021 issuance, combined with the savings from the previous refundings, are over $2.8 million in the form of lower interest payments, all savings to the taxpayer.
The district’s bonds were marketed with a rating of Aa2 from Moody’s Investors Service based on the district’s qualification and inclusion in the Ohio School District Credit Enhancement Program. The bonds were also marketed with the district’s underlying rating of A1, reflecting the financial strength of the district. Due to the utilization of the State Credit Enhancement Program as well as the district’s underlying rating, it ultimately received lower interest rates and a higher level of savings on the transaction.
Mullins added that the WCHCS District and the Board of Education continually review and monitor the budget and operations of the school district in an effort to maintain a stable financial position while providing quality educational programs to the Washington Court House students.
“This is an example of how we can make fiscally responsible decisions and save the taxpayers money while still pursuing our goals. The opportunity would not be possible without the strong support of the community and the ongoing diligence of Superintendent Tom Bailey and Treasurer Becky Mullins,” said WCHCS Board of Education Vice President Dennis Garrison.
