By Kevin Boneske
Staff Writer
ASHWAUBENON – A resolution to pay off bond anticipation notes issued as part of last year’s successful $10.05 million capital referendum was approved May 12 by the school board.
Business Director Keith Lucius said paying off $500,000 in debt a year early next month will save the district more than $16,000 in interest.
“I don’t see a downside in doing it,” he said. “It’s paying debt off early. I think everybody wins… It’s straight taxpayer savings. That money can’t be redirected into anything. It only goes into debt service. It only pays bonds, so it reduces our debt service levy over time.”
Lucius said the long-term bonds for financing the referendum to make facility improvements are for a 20-year period, but could be paid off early to save interest costs when those bonds are callable, as has been done in the past.
For example, after referendums for the high school and elementary schools were held in Ashwaubenon approximately 20 years ago, he said those bonds were paid off two and a half to three years early.
With the early payment being made prior to the end of the current school year, Lucius said it will increase the district’s 2020-21 aidable cost, which is down because of actual expenditures being below the amount budgeted.
“Making this payment before the end of the fiscal year will reduce the fluctuations in our mill rate,” he said.
Lucius said the district’s equalized mill rate has remained below the state average and is currently less than $8 per $1,000.
He said the district has sufficient funds in its debt service account to make the payment in June.
In the event total expenditures come in under budget at the end of the school year, Lucius said the board could also transfer funds into an account for future building projects.
“If we have roof projects coming up, parking lot projects coming up in the next five years, we can use that money just for that,” he said. “We would basically have the expenditure this year, (when) we do the transfer, and then when we actually do the expenditure in the future, it doesn’t hit our aid formula. We’re able to do it, and it allows us to stabilize that budget.”