CLEARFIELD – The Clearfield Area School District’s bond refinancing sale has generated a substantial savings that’s almost three times the district’s target.
The school board heard the results of its bond refinancing sale from Jamie Doyle, managing director of PFM Financial Advisors LLC, the district’s financial advisor, on Monday night.
In 2016-17, she said the district was in the process of refinancing three bond issues to take advantage of the original all-time low interest rates.
Before it could refinance its final bond series from 2012, she said the market shifted and caused interest rates to spike. Since then, she said the district has waited for a favorable market climate.
Doyle said last November, interest rates began to trend back downward, and the district was able to take advantage of new all-time low rates during its Sept. 9 bond refinancing sale.
She said that the district’s 2012 bond series totaled $9.8 million, and it refinanced all except for a small amount ($260,000), which is remaining.
She said the district’s previous interest rates for this bond series were already pretty low, ranging from a low of 2.45 percent to a high of 3.5 percent.
However, she said PNC Capital Markets has purchased the bonds, and the new rates will range from a low of 1.25 percent to a high of 2.5 percent.
This will generate a net savings of $797,259.44 for the district, Doyle said. She added there will be a savings of $54,000 during the current year and $40,000 each remaining year through 2038.
“In 2017, the district’s minimum net savings target was 3 percent, or about $286,000,” she said. “Your end result is almost three times that.”
Doyle said the bond refinancing sale will be finalized Oct. 16. The school board will be asked to consider a parameters resolution at its next meeting, Oct. 24.
Also, during Monday night’s meeting, three school board members were recognized by Erin Eckerd, a representative of the Pennsylvania School Board Association.
Board President Larry Putt was recognized for 16 years of service while board members Phil Carr and Susan Mikesell were recognized for having 12 years of service.