Manteca Unified taxpayers were big winners Thursday.
The district — thanks to its stellar financial situation as verified by two bond rating firms — was able to reduce interest on $66 million of existing Measure M debt by refinancing the bonds to save $4.9 million in future interest payments.
At the same time $19 million in new 30-year bonds issues as part of Measure G for the initial five elementary school revitalization projects were sold at more favorable rates for the district. It will translate into a $1.8 million reduction in projected debt service.
The combined savings will hit $6.7 million
MUSD Chief Business Officer Jacqui Breitenbucer noted due to the strong S&P rating of AA and Moody’s rating of AA2, the underwriter was able to combine both the reissuance and the new bond offerings to garner even better interest rates.
Breitenbucer confirmed the debt service savings were significantly better than what the district had hoped to obtain on the bond market.
District Superintendent Jason Messer added that MUSD’s financial management and situation was seen as such a favorable strength by investors there were four times as many offerings to buy the bonds than the underwriters needed.
The next bond sales for the $159 million Measure G undertaking aren’t scheduled until 2018 and 2021.
Brietenbucer noted the district is trying to do as much work as possible in-house to reduce the need to use bond proceeds.
Some $54 million is projected to be spent on the five initial modernization projects at the Lathrop, Lincoln, Golden West, Shasta, and Sequoia elementary school sites. The five schools were picked for the initial round due to having the biggest needs in terms of modernization and safety issues. They also are the best candidates to obtain possible state reimbursement with the construction work if and when money becomes available if that happens, it would free up bond money to do work elsewhere in the district.