District Issues First Series of Bonds from Measure G and Refinances Existing Bonds
Castro Valley Unified School District
4400 Alma Avenue
Castro Valley, CA 94546
Castro Valley Unified School District Issues First Series of Bonds from Measure G and Refinances Existing Bonds for Taxpayer Savings
Castro Valley, CA – (March 15, 2017) – On Tuesday, March 7, the Castro Valley Unified School District issued its first series of bonds from the recently passed Measure G and at the same time refinanced existing bonds to take advantage of low interest rates in the municipal market. The District issued $53 million of Measure G bonds, which will fund the first phase of projects identified in the District’s comprehensive facilities master plan. Additionally, the District refinanced approximately $11.5 million of outstanding bonds. The financing will close on March 29, 2017.
The Measure G bonds will fund projects at sites throughout the District per the Implementation Plan. The bonds were issued with a combined interest cost of approximately 3.9%, which was achieved due to high demand for the District’s bonds and the District’s high quality credit rating (Aa2 from Moody’s and AA- from Standard & Poor’s).
Through the refinancing, property owners in the District will save over $1 million (or $973,000 in today’s dollars) over the next 9.5 years. In a school general obligation bond refunding, similar to refinancing a home to a lower interest rate mortgage, proceeds of the new bonds are used to retire the older bonds. The lower interest rates reduce the debt service payments, which results in a savings to taxpayers. The bonds were refinanced without extending the term of the prior bonds.
This transaction reflects the commitment of the Board of Education to deliver priority improvement projects associated with Measure G, while also minimizing debt service costs of the District’s outstanding bonds.
Prepared by KNN Public Finance