Refinancing Saves Taxpayers $336,000 in Interest Payments

FROM THE RIPON AREA SCHOOL DISTRICT:
Thanks to the District’s upgrade to an A+ rating by Standard & Poor’s for good financial practices and the decrease in interest rates, recent refinancing of District debt resulted in a savings to taxpayers of more than $336,000 over the next seven years of repayment of the bonds originally issued in 1999. This will mean an estimated decrease in the District’s annual mill rate of 75 cents ($75 on a $100,000 property) through the 2016 tax year.Due to state rules that separate taxes collected for annual operating expenses and taxes collected to pay off previous voter-approved referendum questions such as these bonds, the money saved cannot be used to fill the gap that the District is now facing in its annual operating budget. The decrease in the mill rate does, however, allow the District to seek new voter approval through a referendum to raise money for annual operating expenses and offset any resulting mill rate increase with the decrease that resulted from the refinancing.Carol Wirth, president of Wisconsin Public Finance Professional, the financial consultants used by the District for bond issues, explained, “Ripon was in the right place, at the right time, with the right bond rating to walk away with more than twice as much in savings for taxpayers than originally projected. The higher A+ rating really made a difference, and that shows the benefit of the District using sound financial practices—especially during the stress of difficult financial times as we’re now experiencing.”