Analysis reveals CUSD refinancing of government bonds will save the district and taxpayers upward of $7 million.
By Brian Park
The Capistrano Unified School District’s decision to refinance its government bonds could not have come at a better time and will save the district and taxpayers more than anticipated, an analysis revealed Wednesday.
Lori Raineri, the district’s contracted public finance advisor, delivered the good news during a presentation to the board of trustees.
Refinancing the district’s general obligation bonds, which were derived from a voter-approved measure in 1999, will save the district $7.46 million, or $650,000 annually, from 2013-2014 through 2025-2026. In October, savings were projected at $5.52 million—a 35 percent difference.
The refinancing of Certificates of Participation, which are similar to a mortgage, will save the district $3.19 million, or $260,000 annually, over the same period. Both savings combined, the district could save $10.65 million.
Raineri said savings were higher than projected because interest rates continued to fall, up until the bonds were sold. In both cases, rates eventually increased after bonds were sold. Raineri also said competitive bidding for underwriting saved $1.46 million for the GO bonds and $560,000 for the COPs.
“This is masterful work,” Trustee Jim Reardon said. “I’ve seen a number of refinances around the county in municipalities. Nothing resembles this. The amount of money we’re saving is amazing.”
To view the full presentation, visit capousd.ca.schoolloop.com.