The ISD 728 School Board learned Monday, Oct. 23 that the district will be saving its taxpayers more than $1.4 million after taking steps to refund two sets of obligation bonds.
One of the two bond series – originally issued back in 2008 – was acquired by the district to cover teacher retirement costs. The Minnesota State Legislature allowed school districts to issue the bonds during the height of the recession, a period when many districts around the state were struggling to make ends meet due to prior legislative action.
The other series was issued as a maintenance bond.
The district issued about $3 million in bonds, the bulk of which will be paid off through debt service. Refunding the bonds offers the district considerable savings in interest, to the tune of more than $547,000 on one series of bonds and $861,000 on another.
“Health insurance and other post-employment benefits are definite long-term costs for school districts, so to take steps to reduce those costs is a good thing for taxpayers,” said Joel Sutter, senior municipal advisor for Ehlers Inc., who handled the refunding on behalf of the district. Sutter added that most Minnesota districts bonded for these costs when the Legislature allowed action back in 2008. “Many of them spent considerably more on bonds. Some up to $50 million.”