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CUSD Finds a $200K Annual Savings

Capo officials want to refinance some government bonds.

EDITOR'S NOTE: This story has been edited to delete reference to Trustee John Alpay's campaign website and add references to a second refinance effort scheduled for November. In addition, Las Flores and Capo Valley High schools act as collateral on the bonds, which were used mostly to build the district headquarters.

Just like homeowners, officials at Capistrano Unified School District are looking to ride the refinance wave, too.

On the Board of Trustees agenda Wednesday is an item that would refinance bonds purchased in 2002, which could save the district $2.2 million in present-day value from its payments through the end of the term in 2025-26, according to a staff report.

Annual savings could help the cash-strapped school district save $195,000 a year, the report says.

In 2002, the district took out $31.9 million in what’s called “certificates of participation,” which are not unlike a mortgage, to pay for consruction of the district headquarters and the pool at Capistrano Valley High.

Collateral for the bonds are Las Flores Elementary and Middle and Capo Valley High. They have a remaining principal of about $23 million.

The staff report does not indicate the rate the district will be receiving. The district first heard a presentation about refinancing the bonds in May. 

The board will also consider refinancing Measure A bonds at a meeting in November.

The district is looking at cutting $31 million by next school year if Prop. 30 passes, and $52.5 million if it doesn’t.

The board meets at 7 p.m. Wednesday at the district headquarters, 33122 Valle Road in San Juan Capistrano.

Charles October 23, 2012 at 01:17 AM
"Collateral for the bonds are Las Flores Elementary and Middle and Capo Valley High" What does this mean? If CUSD defaults, the banks take ownership of those schools' land and buildings?
Capo Parent October 28, 2012 at 04:22 AM
Charles That's exactly what it means. What took CUSD so to refinance the COP? It should have refinanced any and all existing obligations it has back in January when interest rates reached their all time low.
Penny Arévalo October 28, 2012 at 04:31 AM
On Wednesday, the board heard rates were 3.68 percent. They were 3.6 in January. So not too far off and much better than when the district first raised the topic in May.
just a parent October 28, 2012 at 04:35 AM
Did you watch the report at the board meeting in May? The expert gave an incredibly detailed explanation of the reasoning behing the timing for refinancing the district's existing debt. It's not as simple as waiting for interest rates to hit bottom and calling your loan agent. Also, at the last meeting, the expert was clear that interest rates are near all time lows right now.

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