Financial advisor says bond refunding could save district more than $800,000 in present-value terms

Matt Dugdale of Siebel presented the board with a potential bond-refunding opportunity for debt issued in 2016. He said the district issued nearly $40 million in that series and that the outstanding portion can be refinanced from a 20-year structure to a 10-year structure to capture lower rates for the remaining term.

“We’re estimating that the district can save north of $800,000 on a present value basis,” Dugdale said, adding the gross savings equate to nearly $100,000 a year through 2035 under the scenarios shown in his materials. He noted sensitivity to market rates and flagged recent volatility in Treasury yields as a factor the district’s finance team will watch closely.

Dugdale said a parameters resolution — the statutory first step for refunding — will be presented to the board at its next meeting if the board wishes to proceed, and that staff have successfully used similar refundings in 2021 and 2022. He did not recommend immediate action at the March 5 meeting but described the mechanics and how timing affects present-value savings.

The board asked questions about market timing and the advisor emphasized that final savings depend on market conditions at the time of sale and on the parameters set in the board resolution.