Fraser Public Schools successfully sells bonds

By: Nick Mordowanec | C&G Newspapers | Published December 10, 2019

Advertisement

CLINTON TOWNSHIP — Fraser Public Schools has successfully sold its 2019 refunding bonds.

The announcement was made Nov. 19 by FPS Director of Communications Kristin Ledford. Proceeds from the sale will refund a portion of the school district’s outstanding balance, due to the Michigan School Bond Qualification and Loan Program.

In 2017, district voters approved a 7-mill bond. For a house with a $150,000 market value, the taxable value was approximately 50% of the market value, or about $75,000. That $75,000 number multiplied by seven mills and divided by 1,000 led to property taxes assessed at a cost of $525.

Due to the passage of a successful 2011 bond, costs for taxpayers did not increase due to the debt retirement window.

The sale’s intention is to reduce future interest expenses by locking in low, federally taxable interests on the loan balance. Based on the state’s current charged interest rate, it is estimated that the district could directly benefit taxpayers by avoiding expenses of up to $1.3 million.

“The current financial landscape made it clear to us that we should move forward with this refunding,” said FPS Business Manager Laurie Videtta.

The district has what it deems “a strong record” of working with finance partners to take advantage of opportunities that manage debt after voter-approved bonds and the like. Since 2005, FPS has four times sold refunding bonds to reduce bond interest expenses paid by taxpayers.

In 2011, the district also issued Qualified School Construction Bonds, which at the time enjoyed federally subsidized interest expense. Today, the federal government subsidizes in excess of 90% of the interest paid on that bond.

“We want to thank our community for their continued support and trusting us to do what is best for kids,” said FPS Superintendent Carrie Wozniak. “We also remain committed to looking out for our taxpayers’ best interests.”

Advertisement