With interest rates at historically low levels, and at the direction of the Board of Education, the Placentia-Yorba Linda Unified School District (PYLUSD) has successfully refunded its 2008 Series C General Obligation (GO) Bonds. Remarkably, this action will save local property tax payers approximately $7.2 million over the life of the bonds without extending the term of the original bonds.
The savings were generated by issuing “refunding” bonds at lower interest rates to repay the existing bonds, similar to refinancing a mortgage at a lower rate.
“It is important that the District continue to actively manage its outstanding GO Bonds to ensure that the community’s hard-earned dollars are maximized. That is what we have done, and will continue to do,” said David Giordano, Assistant Superintendent of Business Services. “This has always been the Board’s direction to staff.”
Wall Street bond rating agency, Moody’s Investors Service, affirmed the Placentia-Yorba Linda Unified School District’s high rating in regards to the issuance, and assigned a positive outlook with a rating of Aa3. Concurrently, Moody’s also affirmed the Aa3 rating on the District’s outstanding GO Bonds and A2 rating on the District’s COPs, or Certificates of Participation. The firm’s credit committee recognized PYLUSD for strong financial management, particularly in times of decreased funding due to declining enrollment and increasing cost pressures faced by school districts throughout California.
This is not the first savings that the District has achieved for its bond program. Four years ago, the District went through a similar process, but instead issued the 2015 GO Refunding Bonds, generating a savings of $6 million for Placentia-Yorba Linda Unified School District local property tax payers.