Geneva schools looking for savings on construction debt interest

The Geneva school board intends to rejigger some of the debt the district owes for its 2007-08 construction campaign, to save on interest being paid.

On Jan. 1, the district can start calling in bonds it sold in 2007, which bear interest rates of 5 to 9 percent. It would issue new bonds, at a lower interest rate, to refund the older bonds. Currently, interest rates on AAA-rated municipal-market bonds, with a 10-year maturity, are around 1.4 percent, according to The Municipal Market Monitor.

On Jan. 1, 2018, it could do so for the 2008 bonds. The interest rate on those was not available Monday evening.

If it did so, and extended the payment time out three years to 2029, the district could save about $4.85 million on interest. It would also be able to keep the amount of property taxes it collects to pay debt flat, at $14.8 million a year.

Otherwise, taxpayers are due to pay $19 million to $24 million a year, ending in 2025, on the district's debt.

The district currently owes $237.6 million in principal and interest.

It borrowed about $93 million in 2007, and $14.6 million in 2008.

The money was used to add Fabyan Elementary School and replace Coultrap Elementary with Williamsburg Elementary. It also remodeled other buildings, including a major renovation of Harrison Street Elementary School.

The school board told its staff to start the paperwork on the sales, and will vote on a formal resolution in September.