Lancaster City Schools Saves Taxpayers Nearly $7.2 Million
District Takes Advantage of Low Interest Rates to Refinance Outstanding Bonds
Beginning in 2021 and through tax year 2049, Lancaster City School District taxpayers will be receiving $7.2 million less in tax bills as a result of refinancing the bonds issued when voters approved construction of the district’s five new elementary buildings in March of 2012.
“We are proud to announce, in essence, a tax ‘rebate’ to the citizens of Lancaster,” said Lancaster City Schools Superintendent Steve Wigton. “While the process is complex, the bottom line is that by being good stewards of taxpayer dollars and maximizing our opportunities to refinance, the citizens of Lancaster will be paying less in taxes than anticipated for this particular construction project.”
Lancaster City Schools took advantage of historically low interest rates in the bond market and embarked on an aggressive bond refunding campaign. The district’s most recent effort was completed November 21, 2019, when it issued $47,457,912 of Refunding Bonds to refinance a portion of its 2012 bond issue.
David Conley, President of Rockmill Financial Consulting, the district’s financial advisor says, “Lancaster School’s bonds were well received by investors. We had in excess of $100 million in orders for the District’s bond, which indicates the District has done a remarkable job insuring they remain attractive in the bond market.”
The school district began working with Rockmill in 2013 to oversee the district’s financings and to help the district strategize about how to lower resident’s taxes. A combination of low interest rates, an excellent credit rating (score), and good market timing allowed the district to save taxpayers approximately
$7,224,082 in interest cost, which will reduce taxpayer obligations beginning tax year 2021 and continuing through tax year 2049.
“A good target for school districts is a savings of 3 percent. However, Lancaster City Schools realized a savings of more than 9.22 percent – three times more than this industry benchmark. The community should be proud of this stewardship of their taxpayer dollars,” Said Conley.
“Lancaster City School’s constantly strives to achieve a very high standard of financial stewardship,” said Julie Taylor, Treasurer, Lancaster City Schools. “We believe the results from this refinancing initiative is a tangible example of how we work each day with this goal in mind.”