FLINT TWP. — Carman- Ainsworth Community Schools last week announced the successful sale of its 2016 Refunding Bonds in the amount of $6,805,000, resulting in nearly a half-million dollars in savings, according to a press release from the school board. The Bonds are being issued for the purpose of refunding the School District’s outstanding 2006 Refunding Bonds and to pay the costs of issuing the Bonds.
The 2016 Refunding Bonds reduce the School District interest expense by approximately $488,793 and will occur through lower debt payments over the next 11 years. This is the fourth time in recent years that Carman-Ainsworth has taken advantage of lower interest rates to save interest expense paid by C-A taxpayers on existing bonds. The school district reduced interest expense approximately $950,346 (2015 Refunding Bonds), $910,765 (2011 Refunding Bonds), and $813,210 (2012 Refunding Bonds).
In preparing to sell the 2016 Refunding Bonds, the School District, working with its financial advisor, Public Financial Management, Inc., requested that Moody’s Investors Service, a division of The McGraw- Hill Companies, Inc. (“Moody’s”) evaluated the School District’s credit quality. Moody’s assigned the School District the outstanding underlying rating of “A3”. The rating agency cited the School District’s structurally balanced operations in fiscal years 2014 and 2015 and manageable debt burden in their rational for rating of the School District at this level.
The School District’s financing was conducted by the Michigan investment banking office of the brokerage firm, Stifel, the financial advising firm, Public Financial Management Inc. and the law firm serving as bond counsel, Collins & Blaha, P.C.
The 2016 Refunding Bonds were sold at a true interest rate of 3.28% with a final maturity of 2027 (a repayment term of approximately 11 years).
Brenda Voutyras, Managing Director with Stifel said: “Carman-Ainsworth Community Schools’ Bonds were well received by the bond market. We were able to take advantage of current low interest rates that met the goals of the District and resulted in a nice savings that will be passed on to the District Taxpayers.” — Rhonda Sanders