Refinancing ‘05 bonds leads to $2.5M savings for District 911, taxpayers

The Cambridge-Isanti School Board, as well as district taxpayers, received some good financial news during the board meeting Thursday, July 19.

Don Lifto, of Springsted Incorporated, reported on the results of the $26 million bond sale that was done to refinance 2005 general obligation bonds. The initial bonds sold in 2005 were used to finance the construction of Isanti Intermediate School and Cambridge Middle School, as well as some other projects.

Lifto explained five bids for the bond sale were received, with the winning bidder being Piper Jaffray, who bid on the bond sale using a 2.4132 percent true interest rate. Lifto explained this means the actual net savings in future debt service levies will be $2,493,301 to the district taxpayers.

“Cambridge-Isanti School District had a terrific day in the financial market,” Lifto said. “Cambridge-Isanti has never issued bonds at that low of an interest rate. It was a terrific time to go out for bids. With a net savings of just under $2.5 million in taxes, this will be a great benefit to the community and its taxpayers.”

Lifto explained all five bids received were competitive bids, with only a .37 percent difference between the lowest and highest interest rate.

Besides Piper Jaffray, other bidders included: Bank of America Merrill Lynch with a true interest rate of 2.4995 percent, JP Morgan Securities with a true interest rate of 2.6043 percent, US Bancorp Investments with a true interest rate of 2.7294 percent and Morgan Stanley & Co. with a true interest rate of 2.7757 percent.

Director of Finance Robyn Vosberg-Torgerson explained the debt service schedule for the newly issued bonds goes until February of 2030. She also noted the district won’t see a change until the 2014 payable 2015 levy.

Lifto explained the school district has an Aa3 Moody’s rating for bond purposes. When determining this rating, Moody’s noted, the “underlying Aa3 general obligation bond rating reflects the district’s medium-sized tax base north of the Twin Cities; sound financial operations despite planned draw downs; and above average debt burden with no additional borrowing plans.”

Strengths noted included conservative budgeting policies leading to consecutive years of operating surpluses, growing population and stable enrollment. Challenges noted included state aid payment delays and plans to utilize reserves over the next two years.

Athletics & Activities presentation

Activities Director Mark Solberg gave an update to the board regarding the 2011-12 activities and athletics season.

Solberg noted 19 of the teams had a cumulative grade point average (GPA) of 3.5 or higher, and four more teams had a cumulative GPA of 3.3 to 3.5.

As far as number of students participating in activities, there were 833 males and 871 females at the high school; 258 males and 207 females at Cambridge Middle School and 202 males and 174 females and the Isanti Middle School/Minnesota Center.

The activities department collected and generated $330,110 in revenue from fall, winter and spring athletics and activities. This money goes to the general fund to help offset a portion of the money spent on athletics and activities.

Solberg noted the district continues to have great Bluejacket support at all athletics, activities and fine arts events.

“I would like to thank you as a board from making Cambridge-Isanti a special place,” Solberg said. “Each and every one of you as a board member is making a difference with the students of the Cambridge-Isanti School District.”

Solberg also noted recent board action that will benefit the district, including action to accept Chisago Lakes, North Branch, Princeton and St. Francis school districts into the Mississippi Conference beginning with the next school year.

“This is a great thing for the school district, parents and guardians,” Solberg noted regarding the close proximity of the schools.

He also mentioned the new George Larson scoreboard will benefit the community.

“This scoreboard benefits kids greatly,” Solberg said. “It will be exciting for the kids to see their faces on the scoreboard, and will bring revenue to the district as well.”

Solberg noted only one advertisement needs to be sold yet for the scoreboard, and there is a five-year payback plan on the scoreboard.

Other projects Solberg mentioned included new fences at the softball and baseball fields, as well as the high school track being resurfaced.

“You as a board help to develop leaders and provide an opportunity for our students to excel at academics, arts and athletics,” Solberg said. “Our parents, guardians and the public really support our schools.”