The District had an opportunity to refund $6,670,000 in construction bonds because interest rates were lower than the rates on our current bonds. This is similar to refinancing your home mortgage.
Generally, it is advised to consider refunding if you can save 3% of your cost. In February, the Board passed resolutions allowing refunding if circumstances were favorable. The pandemic put a hold on the market, but in August rates were really low. Our financial team of Rockmill Financial and Stifel, Nicolaus and Company moved to expedite the process and take advantage of those rates.
We sold our bonds on September 2nd and had great results! At 3% savings, our district would have saved $200,100. Better than that, we saved 10.4%! That’s $881,320 in future payments, or $695,559 in today’s dollars. And we’ll pay off our debt one year earlier, in 2035.