District 883 received a lower than expected interest rate on the bonds authorized by voters in November, which means local taxpayers will pay less than the district estimated prior to the election.
At its January 7 meeting, the Rockford School Board of Education approved the sale of building bonds not to exceed $27 million, the amount approved by voters at the Nov. 6 election. The bonds were sold at an interest rate of 2.67 %, an amount less than the 3.1 % estimated last summer before the election.The bond sale on Jan. 9 attracted 8 bids, with the lowest at 2.67%.
“In terms of total interest cost over the life of the bond issue, we estimated $10,796,000 last summer. The actual interest cost will be $9,649,000, or nearly $1.15 million less than those estimates,” stated Joel Sutter, executive vice president with Ehlers and Associates, the district’s financial advisor.
He added the interest rates the district received on the bond sale are among the lowest the bond market has seen in over 45 years. The lower than projected interest rate will mean homeowners will pay about $35 less a year than expected for a home valued at $250,000. The property tax increase will now only be $11.00 a month, instead of the projected $13.92 per month, for a home appraised at that value.
“When we starting looking into financial options for the district last year, research showed that we would probably never have more favorable conditions to sell bonds,” said Rockford School Board Chair Ted Botten. “This is doing good business at the right time.”
The issuance of the bonds was approved by district voters through one ballot question last November. The bond will allow the district to improve and repair roofs, exteriors, mechanical and electrical systems, and parking lots, as well as athletic field maintenance and upgrades, technology and building security.
“These improvements to our district facilities will strengthen the educational opportunities for our students as well as enhance the indoor and outdoor facilities for our community members who use district buildings and grounds after school hours,” added District Superintendent Paul Durand. “We thank the voters for their support and are committed to keeping our taxpayers informed concerning these projects during the entire process.”
For progress updates on the bond projects, go to the Rockford Area Schools web site: www.rockford.k12.mn.us.