By Madison Morse
Living in the Ledge Staff Reporter
After paying for a School Building and Sites bond issue since it was approved in 2007, the taxpayers of Grand Ledge Public Schools are soon getting a bit of a refund.
Superintendent of Grand Ledge Public Schools Brian Metcalf announced in a press release that taxpayers will see a savings of approximately $3 million over the next 20 years. The money stems from the refinancing the 2007 bond passed for school improvements and will bring a 12 percent savings on interest rates.
“The benefit of refunding or refinancing the bond is that after 10 years we have the opportunity to go back and see where interest rates are. Can we finance any better interest rate that we can save our taxpayers a whole lot of money?” said Metcalf.
“Once that 10 years is up we looked back at it to get some quotes and it showed we were going to save somewhere around 10 percent. So when we had projected a savings at 10 percent we said absolutely, lets move forward. It turned out to be actually about 12 percent or just over $3 million which is a really nice savings for our community and parents.”
Metcalf went on to say taxpayers can expect to get all of these savings back.
“It’s just for taxpayers. Taxpayers already paid for all the projects, that’s already all done. But the debt is the refinancing and that’s how we will save. It’s like refinancing a mortgage,” said Metcalf. “We are watching our bonds. Normally it’s a 30-year bond so every 10 years we have an opportunity to take a look at each of those bonds so they are paid off.”
Although the school is excited about these savings Duke University School of Law professor Richard Schmalbeck said that they should still be cautious.
“If a school district sees that it is going to need capital needs it’s a good time to issues bonds because of interest rates. However, low interest rates have lots of consequences,” said Schmalbeck. “For financing of capital needs of governmental units it’s an unmixed blessing. They lower the cost but have to spend less to finance the construction of new schools.
“How you spend is up to those in the district and how to spend on schools is politically charged. Taxpayers want to spend more on schools but also want less taxes. They can’t have both.”
However, according to Grand Ledge Public Schools taxpayer Carrie Frazer, she would rather see the school use the extra savings.
“It’s going to be beneficial to us bottom line for taxes but I’ve always been a big component of funding the schools. So I would rather see the money go back into the school quite honestly instead of being saved,” said Frazer.
“Schools are so strapped now, that’s all we hear, especially teachers. Right now they’re negotiating their teacher contracts so they’re having trouble getting their grades in and it’s been frustrating. I definitely would rather have the money stay there.”
The schools are trying to accommodate both needs for savings and school improvements going forward in the future said Board President Linda Wacyk.
“With the millage rate dropping it makes us one of the lowest in the area. “We hope that with the dropping of the millage rate when it comes time for another capital area improvement bond that they will approve future bond requests,” said Wacyk.
“It’s been our practice over time as financial conditions improve to refinance those to bring interest rates down for the public so it saves taxpayers money. Thats always the hope but you have to watch the conditions and see what happens.”