What’s happening
The remaining debt for the series 2016 bonds is $158.03 million and the district has the opportunity to refund $131.18 million of that at a lower interest rate. The remaining debt not refunded will be paid off at the current payment schedule, Chief Financial Officer David Johnson said.
The interest rate may decrease from 5% to 3.87%, which would save the district $8.16 million.
The series 2016 bonds became available for a refund April 15 due to favorable market conditions, according to the districts’ financial consultants, BOK Financial Securities. The group suggested that the district refund the bond for a lower interest rate.
As of April 15, the district owes a total of $444.3 million in debt, according to district documents.
Diving deeper
GCISD will move forward with refunding the bond under certain parameters:
- That the market conditions allow for at least 5% or more in savings on interest for the bonds
- That the district can not refinance anymore than $131.18 million
- That the max “all in” interest rate, which looks at the actual interest plus the costs of financing, is 4%
- That the bond must be refunded prior to April 27, 2026
The unlimited tax refunding bonds will be paid off in 2029 and the unlimited tax school building bonds will be paid off in 2037.
The district is planning on refunding the bond May 17 to ensure the right market conditions to save the maximum amount of money on the bonds.
“We want to try to time this up so we can be in a position to maximize the savings and so these are the minimum parameters,” managing director of BOK Financial Securities, Josh McLaughlin said.
Since 2005, GCISD has saved $125.93 million in interest fees by lowering the interest rates of the bonds or paying the bonds before final maturity, McLaughlin said.
Also on the agenda
The GCISD board of trustees unanimously approved a contract with architectural company Huckabee for renovations to Colleyville Elementary School, Heritage Elementary School, Cross Timbers Middle School and the Transportation Center.
The guaranteed maximum price for the contract is $4.96 million and will use funds from the 2024 bond program.
The renovations will include various enhancements such as painting, lockset replacements, roofing repairs, stage drapery replacements and replacing the fuel tanks and fuel dispensers at the transportation center.
The construction will occur over the summer starting May 27 and end Aug. 1, according to district documents.