Adviser touts historically low interest rates
By Jennifer Eisenbart
Staff writer
With interest rates at an all-time low, Burlington Area School District officials listened to a pitch to refinance a portion of its debt Monday night – and made the decision to recommend that move to the full board.
Lisa Voisin of RW Baird – the company that has handled all of the recent bond issuances for the district – walked the BASD School Board Finance Committee through its options, recommending that the district re-finance its 2004 general obligation bonds because of potential savings.
A parameters resolution will be in front of the board on Feb. 20, with an action meeting to follow. The district could save about $55,000 minus legal costs by refinancing the portion of debt Voisin recommended.
The district has six different sets of debt issued, though the Gateway Technical College is reimbursing the district for large portions of that through a lease agreement with the district for the buildings adjacent to Burlington High School.
However, Voisin pointed out that with the interest rates unlikely to go lower and the district close to the call date on its 2004 referendum-approved debt, now would be a good time to refinance.
Voisin also spoke about the district’s bond rating, which, like 51 other districts in the state, is at an A+ rating. The financial advisor then stated the district’s goal should be to get to a AA- rating, the next step on the ladder.
In order to do that, she said, the district would likely have to increase its fund balance to 15 percent of its operating costs, and also create a fund balance policy to dictate when and how the fund balance could be used.
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