District's New Bond Rating Helps Save Taxpayers Millions
With its new bond rating from S&P Global Ratings freshly awarded, the Lakewood City Schools on September 14th refinanced $41 million worth of 2007 series bonds. The refinancing resulted in excess of $7 million (or 14.6%) in savings over the life of the bonds. The annual savings from the refinancing is in excess of $500,000 in bond payments each of the next 14 years.
“The District was aggressive in going after the best price the market would bear and the result was a significant savings for our District and our community,” said Treasurer Kent Zeman.
The refinancing came on the heels of the new rating that was published on September 12th. Citing the District’s “consistently strong financial position,” S&P Global Ratings raised the Lakewood City School District bond rating from AA- to AA. This upward adjustment means the District can sell bonds at a lower interest rate in the future, driving down the cost for the District and increasing savings for the community.
“The rating action reflects our view of the district’s consistently strong financial position, which we believe is sustainable given a track record of strong voter support and good financial management, as well as improvement in the local economy, including assessed value growth,” S&P stated in its report on the rating.
S&P also noted the District’s strong financial management, led by Treasurer Zeman, has allowed the District to increase its reserves in each of the past seven fiscal years. The District’s ability to control expenditures, mostly through attrition of staff levels, negotiating stable labor contracts, and utility and maintenance savings with newly constructed buildings were also factors cited by S&P in its report.
"I am extremely pleased with this new bond rating,” Zeman said. “It is a testament to the hard work the administration has done to keep the District on sound financial ground. I am also pleased that this will result in a savings to the taxpayers, who have generously supported us over the years."