College Bond Refinancing Saves Taxpayers Nearly $1 Million
Taxpayers in Hood River and Wasco Counties will save a combined total of nearly $1 million through a bond refinancing completed this week by Columbia Gorge Community College.
Working with its underwriter, Seattle Northwest, the college executed a General Obligation Bond “refunding sale” agreement to save borrowing costs through lower interest rates. The refunding sale pertains to a bond measure approved by voters in 2004 and issued the following year; these 2005 bonds financed acquisition of the Hood River campus in 2005, construction of new classroom buildings on the Hood River and The Dalles campuses, and capital improvements to existing buildings and infrastructure at The Dalles campus. The two new buildings were completed in 2008.
The bond refinancing does not extend the term of the original bond. Its only effect is to reduce the cost of the 2005 bond issuance to taxpayers by achieving a lower interest rate.
The college’s board of directors approved the refinancing concept in December 2011, enabling Chief Financial Officer Saundra Buchanan to work with the college’s underwriter to attain the savings. The refunding savings rate is about 5.7 percent, which is nearly twice the minimum savings ratio of 3 percent required by state regulations.
"Columbia Gorge Community College builds dreams and transforms lives," noted President Dr. Frank Toda, citing the college’s mission statement. "But in order to do that, we must proceed from a fiscally prudent financial basis. We firmly believe that this philosophy should extend to our relationship with voters in our taxing district, as well. The bond refunding does not directly affect the college’s own finances. It does, however, have a direct and beneficial effect on taxpayers. Those taxpayers will save money as a result of this bond refunding."
Shortly after the closing date of March 15, 2012, a complete transcript of the bond proceedings will be available on the CGCC website.