In 2010, Madison Local Schools issued $10.665 million in bonds under the Build America Bonds (BAB) program. One of the appealing aspects of this program was that the federal government would subsidize 35% of the district’s interest payments on the bonds, saving money for taxpayers.
Unfortunately, over time, a variety of federal government issues have led to reductions in the government subsidy. That means a greater share of the interest burden has fallen to taxpayers in the district.
In late 2019, the district issued new bonds to replace the 2010 bonds. The 2010 bonds had an average coupon interest rate of 3.94%. The new bonds have a weighted average interest rate of 3.05%.
This refinancing will save taxpayers $1.3 million dollars over the duration of the bonds. It also cuts the duration by one year.
At Madison Local Schools, we take our responsibility to taxpayers seriously. We continuously look for opportunities to provide high-level education in a cost-efficient manner. We look forward to a successful and productive 2020!
Mike Vaccariello, Treasurer