Troy schools refinance bonds

The Troy Elementary and High School districts have refinanced outstanding general obligation bonds which will result in a savings to taxpayers of more than $80,000 over the course of the next seven years.

The bonds were originally issued in 2008 in the amount of $900,000 for each district. The voter-approved bonds were used to design, build and equip the Troy Activity Center, which houses a variety of school athletic and other events. The center includes a gym, locker rooms, concession area and multi-purpose room. The bonds also helped with the renovation of the high school’s science lab and auditorium.

The refinance reduces the districts’ interest rate on the bonds from 4.5 percent to 2.05 percent, which totals $78,764 in interest savings over the remaining term of the bonds. An additional savings of $4,900 in adminstration fees brings the total savings up to $83,664.

The savings will be felt immediately by taxpayers, as the debt service levies will be reduced in the 2016/2017 fiscal year. When the bonds are repaid, July 1, 2023, the debt service levies will drop completely from the tax rolls.

School superintendent Dr. Jacob Francom said he was pleased to be able to save the taxpayers’ money with this refinance.

“This is the earliest we could refinance these bonds, under the original terms,” Francom said. “I’ve been keeping my eye on it for the past couple of years, waiting for the opportunity to bring that interest rate down and save the money. It’s basically the equivalent of knocking an entire year off the bond payment, so it’s a very good thing.”

The new bonds have an outstanding balance of $530,000 for each district at 2.05 percent, compared to the original bonds of $900,000 for each at 4.5 percent.