Valley Sees Bond Savings
July 28, 2016 at 4:25 p.m.
By David [email protected]
Steve Meno, public finance vice president, and Jay Ryals, public finance assistant vice president, with Fifth Third Securities, Indianapolis, presented two options for refinancing to the board Monday night.
The board has about three weeks to decide on an option. Monday, the board approved a refunding resolution to begin the process.
“If you’re going to refinance,” Meno said, “this looks like the best opportunity.”
Option 1, an upfront cash option, would include refinancing and not changing Valley’s annual payments. This would leave an estimated $465,000 that Valley could use for facility and/or equipment upgrades, according to information provided. Valley would have approximately three years to expend the funds.
Option 2, a level savings option, would be to refinance and lower Valley’s annual payments on the bonds by an estimated $51,685, according to the information provided. The debt service rate could be lowered a little more than $0.01 based upon the current assessed valuation. This would result in an estimated reduction of $568,000 in payments through 2024 when the bonds will be paid off.
Ryals said the savings for both options are about the same, within $1,000.
Meno said the refinancing process just requires one meeting of the school board and one meeting of the holding corporation. No other state approvals, bond hearings or petitions are needed. It takes about three weeks to get ready.
“You don’t have to tell us tonight which option you prefer,” Meno said. “We’re hitting you cold with this.”
Board President Mark Wise asked how much time the board had to decide on the options, and Meno replied three weeks.
“I don’t think rates will go any lower. This one right now makes sense to do,” Meno said.
Hal Hoffman, board member, asked about costs of implementing either option.
Meno said all expenses of any bond refinancing will be paid out of the savings, thus no general funds of the school are needed to be appropriated for this purpose.
The board unanimously approved the refunding resolution after Superintendent Brett Boggs read it aloud.
The resolution states the bonds were issued May 19, 2004, in the amount of $15,115,000, of which $10,895,000 remains outstanding.
Meno told the board the building corporation will next adopt a similar resolution, and the school board needs to let Meno know which option they prefer to move forward.
The Tippecanoe Valley 2004 School Building Corporation will meet Friday at 1 p.m. in the administration office.
The purpose of the meeting is to get approval of the building corporation to reissue the outstanding bonds of the Tippecanoe Valley 2004 School Building Corporation First Mortgage Bond Series 2004.[[In-content Ad]]
Steve Meno, public finance vice president, and Jay Ryals, public finance assistant vice president, with Fifth Third Securities, Indianapolis, presented two options for refinancing to the board Monday night.
The board has about three weeks to decide on an option. Monday, the board approved a refunding resolution to begin the process.
“If you’re going to refinance,” Meno said, “this looks like the best opportunity.”
Option 1, an upfront cash option, would include refinancing and not changing Valley’s annual payments. This would leave an estimated $465,000 that Valley could use for facility and/or equipment upgrades, according to information provided. Valley would have approximately three years to expend the funds.
Option 2, a level savings option, would be to refinance and lower Valley’s annual payments on the bonds by an estimated $51,685, according to the information provided. The debt service rate could be lowered a little more than $0.01 based upon the current assessed valuation. This would result in an estimated reduction of $568,000 in payments through 2024 when the bonds will be paid off.
Ryals said the savings for both options are about the same, within $1,000.
Meno said the refinancing process just requires one meeting of the school board and one meeting of the holding corporation. No other state approvals, bond hearings or petitions are needed. It takes about three weeks to get ready.
“You don’t have to tell us tonight which option you prefer,” Meno said. “We’re hitting you cold with this.”
Board President Mark Wise asked how much time the board had to decide on the options, and Meno replied three weeks.
“I don’t think rates will go any lower. This one right now makes sense to do,” Meno said.
Hal Hoffman, board member, asked about costs of implementing either option.
Meno said all expenses of any bond refinancing will be paid out of the savings, thus no general funds of the school are needed to be appropriated for this purpose.
The board unanimously approved the refunding resolution after Superintendent Brett Boggs read it aloud.
The resolution states the bonds were issued May 19, 2004, in the amount of $15,115,000, of which $10,895,000 remains outstanding.
Meno told the board the building corporation will next adopt a similar resolution, and the school board needs to let Meno know which option they prefer to move forward.
The Tippecanoe Valley 2004 School Building Corporation will meet Friday at 1 p.m. in the administration office.
The purpose of the meeting is to get approval of the building corporation to reissue the outstanding bonds of the Tippecanoe Valley 2004 School Building Corporation First Mortgage Bond Series 2004.[[In-content Ad]]
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