The Hamilton School Board took action March 2 to refinance $8.75 million of debt from the 1998 referendum. The district was able to refinance bonds from rates that ranged from 4.2 to 4.6 percent into an average 3.08 percent rate. Savings for taxpayers over nine years will be $348,485.
In 1998, Hamilton voters approved a referendum for renovation and addition projects at Maple Avenue Elementary School and Templeton Middle School and the building of Woodside Elementary School. The debt will be repaid in 2012.
The district has refinanced other referendum debt in the past to assure the most competitive interest rate. In the past four years, two other loans were refinanced.
When a school district or municipality borrows — whether for new debt or to refinance an existing one — it must go through a process in which Moody’s Investor Services assigns a credit rating. Moody’s affirmed the district’s Aa2 rating, one that is considered strong among Wisconsin school districts. The high quality financial rating has a positive impact on taxpayers because the district is able to secure loans at lower interest rates than those with less impressive Moody’s ratings.
In its evaluation, Moody’s Investor Services cited the district’s “strong financial position, continued tax base growth due to an advantageous location and moderate debt burden.”
“Moody’s believes the district’s financial position will remain strong due to prudent fiscal management and steady, enrollment growth,” the report stated.
Among positive aspects, the financial researcher noted a stable fund balance which allows the district to avoid cash flow borrowing to meet bill payments.