Refunding of the Santa Monica-Malibu Unified School District’s general obligation bonds from the 2006 election has led to over $2.6 million in savings for district taxpayers, school officials announced.
The refunding of bonds is similar to refinancing a home mortgage, in which homeowners receive lower interest rates and save money by reducing their monthly mortgage payments and/or shortening the years of mortgage debt.
By refunding the 2006 bonds, the district will reduce the overall cost to the community and taxpayers through lower interest rates, without extending the terms of the original bonds, school officials explained.
The savings will be returned to taxpayers in the form of decreased property tax bills. The process is expected to take two to three months to complete.
After the district administration performs the transaction, district taxpayers will receive all of the savings.
“We are excited to provide our taxpayers with over $2.8 million in property tax bill savings. We believe it is our responsibility as stewards of public dollars to take advantage of this bond refunding opportunity,” said Janece Maez, assistant superintendent of Business/Fiscal Services and chief financial officer for the district.
The district was represented in the refunding by Tony Hsieh of Keygent, LLC.
During the financing process the district also received updated credit ratings from both Moody’s Investor Service and Standard & Poor’s. The district’s updated credit ratings of Aa1/AA are considered among the best for California school districts and allowed the district to garner significant investor interest that led to very low interest rates, school officials said.