Report: School district refinancing saved $1.1 billion

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by JOHN LANGELER / KING 5 News

NWCN.com

Posted on January 20, 2013 at 6:26 PM

Updated Sunday, Jan 20 at 7:43 PM

A new “informal” report found 43 of Washington’s school districts refinanced their long-term bond payment interest rates in 2012, saving taxpayers $1.1 billion.

The report was produced by the Puyallup School District by requesting voluntary information from other districts.  It comes weeks before Puyallup voters will decide whether to approve a $279 million bond to upgrade several of its facilities.  Puyallup School District has not had a bond approved in nine years.

Refinancing bonds is not new, according to Peter Daniels from the Puget Sound Educational Service District, which supports local schools.  However, Daniels added, the amount of savings is more than normal.

“In 2005, we were paying interest rates in the 7% range,” Daniels explained, “Now, we’re down to 3.5%.”

Those low interest rates allowed Puyallup to refinance twice in 2012, according to the district.  Lowering its interest rate on a $161.8 million bond saved its taxpayers $23 million.

But Puyallup resident Andy Asmussen, who opposes Puyallup’s proposed bond, said while the refinancing results are good, asking taxpayers to dish out more money is wrong.

“It seems kind of odd to me that all of a sudden, now they announce (refinancing results) just before coming forward with a request for more bonds,” Asmussen countered.

Asmussen also said those historically low interest rates and construction costs will remain low, making an urgent bond request unnecessary.

The Puyallup School District said overcrowding does in fact make this bond measure urgent.

Spokesperson Brian Fox said the district’s report shows it school administrators are good stewards of taxpayer dollars.

Puyallup’s bond election is February 12th.  Along with a $500 million bond proposal from Tacoma, it is one of two major school requests next month.

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