The funds were part of the $47 million bond proposition approved by voters in 2010. The $17 million portion paid for the district’s eleventh elementary school, Carver Elementary, which is set to open in August, GISD Chief Financial Officer Steve West said.
The $17 million was initially issued as a variable rate bond with a three-year term in 2012. The board’s decision this week to refund for another three-year-period will run through July 31, 2018.
West said the district approved refinancing at a market rate up to 2.5 percent. Since current rates are around 1.6 percent, he expects to refinance with the lower rate when the bonds go up for sale in August.
“Those parameters give us the railings, they’re the edge of the highway, we don’t go outside of the lane that we’re operating in,” he said.
The benefit of the variable rate bond order gives the district flexibility to time the sale of the bonds during good market conditions, which can maximize savings. Over the past three years, the financed bonds saved the district about $1.8 million compared to the price of a fixed rate bond, and West said he expects to save nearly $1 million throughout the next three years. The total six-year savings is close to $2.75 million, he said.