MG BOE reduces costs through refinancing


Staff Report



Mount Gilead, Ohio — Recently, the Mount Gilead Exempted Village School District, with the help of Ross, Sinclaire & Associates, LLC, refinanced its 2005 School Facilities Construction and Improvement Refunding Bonds to take full advantage of the favorable conditions In the municipal bond market. The 2005 Bonds were issued originally for the purpose of constructing a new elementary school, renovating the high school building, and for a partial refunding of a prior bond issue.

Standard & Poor’s Ratings Service assigned a rating of “AA-“, and Moody’s Investors Service assigned a rating of “A1” to the bonds. Standard & Poor’s cited “good financial and “management’s ability to effectively control management policies and practices’, expenditures”, on behalf of the District. Specific policies highlighted by Standard & Poor’s include management’s “formal policy to maintain the unencumbered general fund balance at 8% of budgeted expenditures”, and the policy for the Board of Education to discuss possible new sources of revenue or expenditure reductions should the District forecast a negative cash balance 24 months from the current fiscal year.

The $5,055,000 refinancing will save taxpayers of the District over $505,000 in gross debt service savings over the life of the issue, significantly reducing the net interest cost of the Bonds to approximately 2.27% for the next 14 years.

The District Superintendent Jeff Thompson, Treasurer Trevor Gummere, and the Board of Education strive to take advantage of every opportunity to reduce taxes for the District’s constituents. Management’s decision to capitalize on favorable bond market conditions provided a great opportunity to save money for the community.

Staff Report