YC refinances bond, saves taxpayers money
PRESCOTT – In a move that will save taxpayers at least $300,000 over seven years, the Yavapai College District Governing Board Tuesday unanimously approved refinancing the remainder of general obligation bonds that paid for building the Performance Hall and initial campuses in Prescott Valley and Chino Valley.
"We're refinancing it down from over 5 percent interest rate to a 3.25 percent rate," said Member Tony Decker. "We promised voters that we'd save tax monies everywhere we could, and we are."
Finance Director Terry Bowmaster said this is the second time the college has refinanced the bond that voters approved in 1988 for $11.3 million and issued in three series: 1989, 1990 and 1991. The first time was in 1993, but interest rates have dropped again, giving the college another chance to save money on the debt, which is now a little over $5 million.
"The reason that we're able to do this one now is that the bonds are almost 10 years old and are callable on July 1, 2003," Bowmaster said. "The law does allow you to do a re-funding three months in advance of the call date."
The result will be a direct pass-on to taxpayers in the form of a reduction of between a half-cent and three-quarters of a cent in the secondary tax rate, Bowmaster said.
That's fairly small, but Bowmaster notes that if interest rates remain low until next summer, when the college is ready to do the next issue of the $69.5 million debt to finance expansion and renovation, there will be more good news for the taxpayer. Combined with Tuesday's refinancing, the savings could amount to a couple of cents off of next year's tax rate, Bowmaster maintained.
In addition to construction of the Chino Valley Educational Center, 202 N. Highway 89, and the Prescott Valley Business & Career Center, 6955 Panther Path, money from the 1988 bond added faculty offices and classrooms to Building 3 on the Prescott campus.
Contact Louise Koniarski at email@example.com.