JACKSON SCHOOL BOARD VOTES FOR MONEY-SAVING REFINANCING

JACKSON -- The Jackson Board of Education voted to take advantage of low interest rates and refinance bonds sold in 1996.

Options to similarly refinance bonds sold in a 1993 issue and a 1993 lease issue were passed because savings were not sufficient.

The action is similar to refinancing a house mortgage and should net the district about $400,000 in long-term savings. The savings will not be tangible in the usual sense, he said. Any savings will have to go back into the debt service fund, where it will reduce interest payments.

"The net present savings must be a minimum of one-half percent of the par value of bonds," said Larry J. Hart of L.J. Hart & Company. "There will be a savings of around three-and-a-half percent on your bonds."

The callable, tax-exempt bonds were originally sold at an average 5.67 percent interest rate, Hart said. Interest rates have dropped nearly one point since that time, making refinancing a good option for the district.

In August 1996 voters approved a $7.8 million bond issue to construct additional classrooms and office space needed because of significant increases in enrollment. Financed by the issue were: a new math and science building; offices at the high school campus; an addition at North Elementary; a new elementary school south of Jackson; and land acquisition, equipment and furnishings as needed.

Hart said many school districts in the state are taking advantage of the favorable market and refinancing their bond issues. He said the only downside to the action was the district would not be able to refinance the bonds a second time if the market continued to improve. The federal government permits only one refinancing between the bond issuance and 90 days before the call date.

The call date of the 1996 bonds is in 2003.

In other business, the school board approved the purchase of two 83-passenger school buses and one 32-passenger handicapped-accessible bus from Central States Co. The company submitted a low bid of $166,630 to win the bid.