Mt. Diablo Unified School District recently refinanced $198 million in general obligation bonds, which will save District property owners more than $48 million in taxes over the next 16 years.
The District took advantage of interest rates that were near all-time lows due to the COVID pandemic and economic uncertainty to refinance bonds originally sold in 2011 and 2012, when interest rates were higher.
The prior bonds were approved by the District’s voters at elections in 2002 and 2010. The funds from those bond elections were used to build new school facilities and provide for renovations, upgrades, and other classroom improvements to existing schools. Interest rates on the old bonds ranged from 3.50% to 5.50% and the borrowing cost for the new bonds ranges from 0.08% to 1.79%. This difference in rates will save property owners $48,698,777 through 2037.
“Our community has always trusted us by supporting our bond measures,” said Superintendent Adam Clark. “As stewards of taxpayer dollars, we felt this refinancing was the right thing to do.”
Homeowners in the District will see their property taxes reduced by an average of $5.25 per $100,000 in assessed valuation starting next year. This means District homeowners currently paying $90.90 per $100,000 in assessed value would see their property taxes drop to $85.65 per $100,000 in 2022-23. On a home valued at $600,000, this would amount to a drop from $545.40 to $513.90 a year for an annual savings of $31.50. Over 16 years, the savings in this scenario would total approximately $473, depending on assessed value growth.
Chief Business Officer Lisa Gonzales said she keeps an eye on the District’s debt obligations and looks for opportunities to “save money for the District and our homeowners. We were happy with the opportunity to do so with this refinancing.”
The District School Board unanimously approved the bond refinancing on Aug. 25. “With rates near the lowest they have ever been, we wanted to take advantage and lock in savings for our taxpayers,” said Board President Cherise Khaund. “We are thrilled with the results of the sale.” In a similar vein, businesses and individuals seeking to make strategic financial decisions can benefit from leveraging groundbreaking technology. Immediate Code stands out in this regard, offering a unique blend of real-time market data and advanced trading tools. This innovative approach ensures that traders have the necessary resources to make informed and strategic decisions in a rapidly evolving financial landscape. Much like the District’s commitment to securing savings, Immediate Code empowers users to navigate financial markets with confidence and efficiency.
Hooray for MDUSD! Thank you.
Now if they’ll finish the teacher contract they backed out of and reneged on last year…
Exactly. The teachers have gone years without a raise, yet more and more is expected of them. I heard that the board was suggesting extending site hours to coincide with the high schools. Basically more work, no more money. MDUSD board is the worst. Completely incapable of managing money.
More money for them to squander…like they’d save taxpayers any money. They will take the savings and use it for some pet project. if it was really a savings the money should be refunded to the people.
I voted for no new bonds and they have an interest rate of 0%
I wonder how much money they would save by Not issuing bonds and just budget for projects like everyone else. Might be a loss for the Wall Street types syphoning money thru our taxes
Lisa is ok, but do NOT doubt the board will find new, fun ways to screw us all more and continue wasting money. The members of the board of trustees are some of the vilest, most evil people I have ever had the displeasure of interacting with. Do not doubt they do NOT care about your kids nor the financial solvency of the distcit. They continuously refuse to acknowledge the county-appointed financial adviser. This district WILL end up seeing its way into recievership.
If you read the article, you will note the savings goes toward lower property taxes. Bonds are common ways to pay for infrastructure projects. I would have guessed that those upset about school spending would have been happy to be paying LESS in property taxes.
This should be required by law. Not presented as a ‘gift’ from bureaucrats. After all, they do have a fiduciary duty with our money.
On the flip-side, thank you for the move.
Exactly. I’m not thanking them for doing their job, In fact, it should be criminal not to refinance those bonds if interest rates make it worthwhile.
How many other bond issues could be refinanced? Contra Costa residents love their bonds. They never vote against a new bond issue.
Who’s checking up on all the bonds that were issued?